Fireworks in September ? Stay Tuned

Fireworks in September ? – Stay Tuned
INVESTORS first read.com – Daily edge before the open
DJIA: 25,986
S&P 500:2,901
Nasdaq Comp.:8,088
Russell 2000: 1,732

Friday, August 31, 2018    9:08 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
Expect the big traders to head out early today for the Labor Day weekend.  That would call for a low volume ho-hummer, unless the administration releases big news. The obvious candidate would be Canada joining Mexico in Trump’s over-trumped Nafta tweak.
       The kids are back to school.  Lounging in the sun, golf and tennis at the club, cocktail  soirees, cruising in the Sound are getting one more go of it before the big boys get serious about trading.
        The fall has frequently featured market bottoms and recoveries, or at least the advent of serious institutional investing. October boasts 7 of the last 14 bear market bottoms.
        What does that mean with a market that has risen 7% since June 28 ?
A dramatic move to the upside would be wishful thinking.
        I think we will have to wait for September when institutional money managers return to their trading desks.

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              It’s been 10 years since the bear market that accompanied the Great Recession  of 2007-2009. Memories are short. I don’t doubt that a good number of Wall Street decision makers were in the business then.
        Cash is an investment, which is only appreciated when the market declines.
         Futures indicate a lower open. News of Canada accepting the tweaked Nafta Mexico deal should trigger some buying. Throw in Europe and there should be more buying. China is a different story. They can’t be bullied.
        With a 3-day weekend approaching, aggressive traders will want to even-up positions just in case bad news surfaces over the weekend.
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 A “preliminary agreement in principle” with Mexico to revise certain issues in Nafta has been reached, and I expect Canada to follow suit. Europe is next, but China will be more challenging since, since  any trade decision will have to accommodate  the egos of the presidents of both countries, Trump and Xi Jinping.
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      This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year and inventories are rising. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales (excl. condos) dropped in July, the fourth month in a row; New Home Sales dropped 1.7% in July.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mam.econoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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SUPPORT “today”:DJIA: 25,976; S&P 500:2,896;Nasdaq Comp.:8,061
RESISTANCE: “today” DJIA:26,039; S&P 500:2,909; Nasdaq Comp.:8,101
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RECENTLY
MARKET OVERVALUATION:   
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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THE ECONOMY:   

  There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
        
Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 33.0 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.28 vs.  an average of 1.45.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (115months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 116 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET

DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post)..
every American with a smidgeon of self respect should too !
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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 ?. 

The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
Trump must think he’s ons oooooo            Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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A recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
pecial Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t conservative Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be.  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    ……………………………………………….
Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent. The depth of her ties to Republicans and the NRA appear to be significant.  …………
      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
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Trump an agent of Russia ?  His actions suggest it.
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. …………………………………..
President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants.  I think Trump has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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Will Trump  Fire Mueller

      Trump can’t fire Mueller directly, it must be done by the Department of Justice.  Trump would have to find someone to do it.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.         Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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George 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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

 

 

 

 

 

 

Has Market’s Rise Discounted Nafta Tweak with Mexico and Canada ?

INVESTORS first read.com Daily edge before the open
DJIA: 26,124
S&P 500:2,914
Nasdaq Comp.:8,104
Russell 2000: 1,734

Thursday, August 30, 2018    9:08 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
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Historically, August has a bad rep for market declines, but so far one 2.3% correction has been overridden by a 4.3% rally, at least through Wednesday.
      Yesterday, I headlined “40% Cash Reserve.”
      With the stock market in lockstep with a humming economy, and nary a bear in in sight, that suggestion will undoubtedly fall on deaf ears.
      Well, no one knows when the institutions will walk away from the market, unwilling to pay up for stocks that by reasonable standards are “rich.”
       No one knows when they will lock in fat gains, fearful a correction will erase most of them.  
        For any investor with cash, the urge to go all-in must be overwhelming.  Money managers have no choice but to put cash to work.
       This is what a late-stage bull market looks like, this is why so many will get caught when it turns down.
        It’s been 10 years since the bear market that accompanied the Great Recession  of 2007-2009. Memories are short. I don’t doubt that a good number of Wall Street decision makers were in the business then.
        Cash is an investment, which is only appreciated when the market declines.
         Futures indicate a lower open. News of Canada accepting the tweaked Nafta Mexico deal should trigger some buying. Throw in Europe and there should be more buying. China is a different story. They can’t be bullied.
        With a 3-day weekend approaching, aggressive traders will want to even-up positions just in case bad news surfaces over the weekend.
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 A “preliminary agreement in principle” with Mexico to revise certain issues in Nafta has been reached, and I expect Canada to follow suit. Europe is next, but China will be more challenging since, since  any trade decision will have to accommodate  the egos of the presidents of both countries, Trump and Xi Jinping.
Details of the tweaking of Nafta will  be parsed in coming days to give us an idea if much was accomplished.  It comes conveniently close to the mid-term elections.
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      This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year and inventories are rising. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales (excl. condos) dropped in July, the fourth month in a row; New Home Sales dropped 1.7% in July.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mam.econoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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SUPPORT “today”:DJIA: 26,065; S&P 500:2,907;Nasdaq Comp.:8,089
RESISTANCE: “today” DJIA:26,176; S&P 500:2,919; Nasdaq Comp.:9,107
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RECENTLY
MARKET OVERVALUATION:
      August has the rep of being a nasty month for stocks
. So far, this August is an exception.
      Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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THE ECONOMY:   

  There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
        
Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 33.0 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.28 vs.  an average of 1.45.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (115months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 116 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET

DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
       Maybe this administration and many supporters have no problem with lying being the new normal or truth alterantive, but I do, and every American with a smidgeon of self respect should too !
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The U.S. may explore ways to ease trade tensions with China this week.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

 

 

 

 

 

 

 

 

 

Will Canada Join Mexico in the Trade Deal Before Deadline ?

INVESTORS first read.com – Daily edge before the open
DJIA: 26,064
S&P 500:2,897
Nasdaq Comp.:8,030
Russell 2000: 1,728

Wednesday, August 29, 2018    9:11 a.m.
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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
My  experience having been in this business 56 years is that it is next to impossible for anyone to listen to warning signals at market tops and the same at market bottoms when a lone voice with umpteen good reasons says BUY.  I can only try.  Tops take much longer to form than bottoms. It is usually smart to leave a little on the table for someone else when selling. Trying to catch the ultimate high can be costly if the market suddenly turns down.
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    The Trump administration has reached a “preliminary agreement in principle” with Mexico to revise certain issues in Nafta, and will now attempt to include Canada in any final agreement. The deadline for a decision is Friday, though some think that will be extended.
     CNN  does not consider it a formal free trade agreement between the U.S. and Canada, only an agreement to resolve certain Nafta issues. If Canada comes on board, which they will eventually if not this week.
      So far Mexico,  and Canada have insisted that any agreement must include Canada. A deal with Canada would have to be reached by Friday before the U.S. slaps a 25% tariff on Canadian imports. That deadline may be changed.
      We are seeing progress in trade negotiations, but nothing is final.
It is too early to parse all the positives and negatives of this deal and how it could impact negotiations with China.
       It is unlikely (not impossible) that progress with China will  be made later in the year.  Any trade decision will have to accommodate  the egos of the presidents of both countries, Trump and Xi Jinping.
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      This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year and inventories are rising. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales (excl. condos) dropped in July, the fourth month in a row; New Home Sales dropped 1.7% in July.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mam.econoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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      For any investor with cash, the urge to go all-in must be overwhelming.  Money managers must have no choice but to put cash to work.
       This is what a late-stage bull market looks like, this is why so many will get caught when it turns down.
        It’s been 10 years since the bear market that accompanied the Great Recession  of 2007-2009. Memories are short. I don’t doubt that a good number of Wall Street decision makers were in the business then.
 
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SUPPORT “today”:DJIA: 26,117; S&P 500:2,903;Nasdaq Comp.:8,039
RESISTANCE: “today” DJIA:25,987; S&P 500:2,893; Nasdaq Comp.:8,011
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RECENTLY
MARKET OVERVALUATION:
      August has the rep of being a nasty month for stocks
. So far, this August is an exception.
      Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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THE ECONOMY:   

  There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
        
Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 33.0 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.28 vs.  an average of 1.45.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (115months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 116 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET

DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
       Maybe this administration and many supporters have no problem with lying being the new normal or truth alterantive, but I do, and every American with a smidgeon of self respect should too !
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The U.S. may explore ways to ease trade tensions with China this week.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

 

 

 

 

 

 

 

40% Cash Reserve

INVESTORS first read.com – Daily edge before the open
DJIA: 26,049
S&P 500:2,846
Nasdaq Comp.:8,017
Russell 2000: 1,728

Tuesday, August 28, 2018    9:11 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
    The Trump administration has reached a “preliminary agreement in principle” with Mexico to revise certain issues in Nafta, and will now attempt to include Canada in any final agreement.
     CNN  does not consider it a formal free trade agreement between the U.S. and Canada, only an agreement to resolve certain Nafta issues.
      So far Mexico,  and Canada have insisted that any agreement must include Canada. A deal with Canada would have to be reached by Friday before the U.S. slaps a 25% tariff on Canadian imports. That deadline may be changed.
      We are seeing progress in trade negotiations, but nothing is final.
       It is unlikely (not impossible) that progress with China will be made until later in the year.  Any trade decision will have to accommodate  the egos of the presidents of both countries, Trump and Xi Jinping.
 


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      The People’s Bank of China (PBOC) has stepped in to support the yuan. Its action may be to head off capital outflows or possibly appease the United States ahead of any further trade negotiations. The yuan is fixed to the U.S. dollar at a midpoint, but can  deviate within a fixed range from that point.
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     This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales (excl. condos) dropped in July, the fourth month in a row; New Home Sales dropped 1.7% in July.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mam.econoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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     The futures indicate a higher open. For any investor with cash, the urge to go all-in must be overwhelming.  Money managers must have no choice but to put cash to work.
       This is what a late-stage bull market looks like, this is why so many will get caught when it turns down.
        It’s been 10 years since the bear market that accompanied the Great Recession  of 2007-2009. Memories are short. I don’t doubt that a good number of Wall Street decision makers were in the business then.
       

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SUPPORT “today”:DJIA: 26,027; S&P 500:2,895;Nasdaq Comp.:8,007
RESISTANCE: “today” DJIA:26,126; S&P 500:2,907; Nasdaq Comp.:8.031
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RECENTLY
MARKET OVERVALUATION:
      August has the rep of being a nasty month for stocks
. So far, this August is an exception.
      Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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THE ECONOMY:   

  There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
        
Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 33.0 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.28 vs.  an average of 1.45.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (115months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 116 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET
Hung Jury ? That was my Aug 8 headline. While Manafort was found guilty on 8 counts, the jury was hung on 10.
     
A lone juror could not be convinced by the other 11, that Manafort was guilty on the ten counts that did not get a verdict, according to one of the jurors who admitted she was a Trump supporter and didn’t want Manafort to be found guilty but voted to convict anyhow because the evidence was overwhelming. Wow.
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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
       Maybe this administration and many supporters have no problem with lying being the new normal or truth alterantive, but I do, and every American with a smidgeon of self respect should too !
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The U.S. may explore ways to ease trade tensions with China this week.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
..
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

 

 

 

 

 

 

Street Ignores Trump, Trade, Fed, Valuations

INVESTORS first read.com – Daily edge before the open
DJIA: 25,790
S&P 500:2,874
Nasdaq Comp.7,945:
Russell 2000: 1,725

Monday, August 27, 2018    9:11 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
     
The futures indicate a higher open. For any investor with cash, the urge to go all-in must be overwhelming.  Money managers must have no choice but to put cash to work.
       This is what a late-stage bull market looks like, this is why so many will get caught when it turns down.  Based on market behavior in recent years, the first move down will be so abrupt, investors will not have a chance to sell.
       The key then will be, what new news hits the market to discourage institutions from buying in at a discount or selling on strength.
        It is next to impossible to warn investors of risk in this feeding frenzy, just as it next to impossible to encourage them to buy after a 35% – 50% plunge.
         That is why buy low/sell high is so difficult.
         Bull market tops are so much more difficult to pinpoint because institutions must be buying at all times, no one will pay they to sit on cash even if it is the client’s best interest.
         At the bear market bottom in 2009 with the DJIA around 7,000 (now 26,000), I began an intense campaign to encourage readers to get ready for a historic buying opportunity three weeks before issuing a buy.
      The great majority of the Street’s buy/sell decisions are based on computer algorithms designed to maximize return.  So many are based on the same metrics, the big difference being the rotation of strength in industry groups.
      At some point those algos will be changed to defer purchase of sell.
      All it takes is for one big institution to sell and the others will follow.
      The market is so very overvalued at this point, and signs of weakness in the economy are filtering in, so that point cannot be far away.
       I have seen the damage that can be done to portfolios by a 35% – 50% drop in stock prices. I can only warn readers and hope they at least establish a cash reserve. 
       But human nature generally overrides common sense, and the tendency is to keep buying because the market is rising – just like the tendency at market bottoms is to keep selling.
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The People’s Bank of China (PBOC) has stepped in to support the yuan. Its action may be to head off capital outflows or possibly appease the United States ahead of any further trade negotiations. The yuan is fixed to the U.S. dollar at a midpoint, but can  deviate within a fixed range from that point.
       Any trade decision will have to accommodate  the egos of the presidents of both countries, Trump and Xi Jinping.
      A preliminary agreement on NAFTA between  the U.S. and Mexico  may be announced this week, though it is not expected to include Canada.
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     This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales (excl. condos) dropped in July, the fourth month in a row; New Home Sales dropped 1.7% in July.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mam.econoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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SUPPORT “today”:DJIA: 25,896; S&P 500:2,886;Nasdaq Comp.:7,977
RESISTANCE: “today” DJIA:25,830; S&P 500:2,878; Nasdaq Comp.7,953 assuming the
market advances more than 100 points.
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RECENTLY
MARKET OVERVALUATION:
      August has the rep of being a nasty month for stocks
. Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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THE ECONOMY:   

  There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
        
Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 33.0 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.28 vs.  an average of 1.45.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (115months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 116 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET
Hung Jury ? That was my Aug 8 headline. While Manafort was found guilty on 8 counts, the jury was hung on 10.
     
A lone juror could not be convinced by the other 11, that Manafort was guilty on the ten counts that did not get a verdict, according to one of the jurors who admitted she was a Trump supporter and didn’t want Manafort to be found guilty but voted to convict anyhow because the evidence was overwhelming. Wow.
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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
       Maybe this administration and many supporters have no problem with lying being the new normal or truth alterantive, but I do, and every American with a smidgeon of self respect should too !
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The U.S. may explore ways to ease trade tensions with China this week.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

 

 

 

 

 

Analysts Rethinking Algorithms

INVESTORS first read.com – Daily edge before the open
DJIA: 25,656
S&P 500:2,856
Nasdaq Comp.:7,878
Russell 2000: 1,717

Friday, August 24, 2018    9:19 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
     
While the market has ignored political developments, except the big run triggered by Trump’s 2016 election, the developments with Cohen’s guilty plea and Manafort’s conviction should send analysts and money managers back to the drawing board.
      Algorithms written to buy no matter what may be tweaked in coming days, since the Cohen/Manafort developments may signal a prolonged release of  a host of additional indictments/convictions that stand to gut consumer and corporate confidence in the future.
      This could get ugly, very ugly, and that is not good for the future of stock prices which are historically overvalued.
      Uncertainty could trigger profit-taking, which could result in a cascade of selling “just in case” the worst is yet to come.
      It is becoming common knowledge that only the top 5% of our country and  corporations are benefitting from Trump policies.
      What really drives the economy is the other 95% and they are increasingly strapped for cash and room on their cards.
      On top of the mounting angst about the survival of Republicans at all levels, there are signs of  cracks in the economic expansion, namely housing and all the industries that depend on its health, as well as motor vehicles, and all the industries that depend on its health.
      With most institutions in a buy mode, what happens when someone breaks ranks and sells ?

       Others follow suit.
       Bull markets take longer to die. The initial drop catches everyone off guard.  At this point the market is down 8% – 12%.
That can be enough to attract buyers, but then another negative surfaces (prospect of recession), triggering another leg down
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     This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales will be reported today at 10 o’clock, New Home Sales same time Thursday.
      What’s more, the Philly Fed general manufacturing conditions index (Mid-Atlantic region) is in a nosedive.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mameconoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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SUPPORT “today”:DJIA: 25,551; S&P 500:2,851;Nasdaq Comp.:7,865
RESISTANCE: “today” DJIA:25,729; S&P 500:2,863; Nasdaq Comp.:7,901
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RECENTLY
MARKET OVERVALUATION:
      August has the rep of being a nasty month for stocks
. Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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THE ECONOMY:   

  There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
        
Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 32.8 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.24 vs.  an average of 1.49.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (109 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 110 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET
Hung Jury ? That was my Aug 8 headline. While Manafort was found guilty on 8 counts, the jury was hung on 10.
     
A lone juror could not be convinced by the other 11, that Manafort was guilty on the ten counts that did not get a verdict, according to one of the jurors who admitted she was a Trump supporter and didn’t want Manafort to be found guilty but voted to convict anyhow because the evidence was overwhelming. Wow.
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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
       Maybe this administration and many supporters have no problem with lying being the new normal or truth alterantive, but I do, and every American with a smidgeon of self respect should too !
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The U.S. may explore ways to ease trade tensions with China this week.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.

Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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 Russia’s Vladimir Putin coming to Washington in the fall ?  Is he running for office ?  He can count on support from the Republicans.
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

 

 

 

 

Jury Out on the Next 12 Months

INVESTORS first read.com – Daily edge before the open
DJIA: 25,33
S&P 500:2,861
Nasdaq Comp.:7,889
Russell 2000: 1,722

Wednesday, August 22, 2018    9:09 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
     
Paul Manafort’s conviction and Michael Cohen’s guilty plea had little affect of the market yesterday, and I don’t think it will until more evidence of Republican wrongdoing surfaces.
     
The corporations and big earners got their tax cut, with no concern how the resulting shortfall in government revenues in the future will impact our country in the future.
       Republicans rationalize that economic growth will fill the void, giving no consideration to the likelihood of a recession starting next year.
      The BIG money always survives. What concerns me is the 95% who will struggle as a result of one-sided Trump administration policies.
      With interest rates still low and the Fed only beginning to unwind its balance sheet, the Fed is ill-prepared to help the U.S. out of a recession.
       Cutting corporate taxes further would be irresponsible and compound our nation’s fiscal problems four to six years out.
      The risk for Republicans is that its narrow and heartless policies stand to put its candidates on the sidelines for a generation
      This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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Short squeeze in Treasuries ?  DoubleLine Capital’s Jeffrey Gundlach just informed  Bloomberg net short positions of the 10-year Treasuries hit their highest level on record raising the possibility of a short squeeze prompting big buying to cover shorts, ergo higner bond prices and lower yields, at least near-term.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales will be reported today at 10 o’clock, New Home Sales same time Thursday.
      What’s more, the Philly Fed general manufacturing conditions index (Mid-Atlantic region) is in a nosedive.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mameconoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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        The Fed will report  the minutes from its August 1 Federal Open Markets Committee (FOMC) meeting at 2 o’clock today and Fed chair Jerome Powell will deliver a speech about monetary policy Friday at the Fed’s annual meeting in Jackson Hole, Wyoming. 
      As I have warned repeatedly, The stock market turns down ahead of the beginning of a recession with a lead time of 3 to 12 months. My guess for this one is 12 months.
        One disadvantage of having personally experienced 13 bear markets is you see the warning signs well ahead of the  Street which is now staffed by decision makers many who haven’t seen more than one bull market tops – if that. 
        Bottom line – Ultra high risk – Cash reserve essential. When this one breaks, it will be straight down, starting out with a plunge of 12% – 18% in a matter of days.
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SUPPORT “today”:DJIA: ; S&P 500:;Nasdaq Comp.:
RESISTANCE: “today” DJIA:; S&P 500:; Nasdaq Comp.:
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RECENTLY
MARKET OVERVALUATION:
      August has the rep of being a nasty month for stocks
. Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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THE ECONOMY:   

  There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
        
Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?    
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 32.8 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.24 vs.  an average of 1.49.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (109 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 110 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET
Hung Jury ? That was my Aug 8 headline. While Manafort was found guilty on 8 counts, the jury was hung on 10.
     
A lone juror could not be convinced by the other 11, that Manafort was guilty on the ten counts that did not get a verdict, according to one of the jurors who admitted she was a Trump supporter and didn’t want Manafort to be found guilty but voted to convict anyhow because the evidence was overwhelming. Wow.
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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
       Maybe this administration and many supporters have no problem with lying being the new normal or truth alterantive, but I do, and every American with a smidgeon of self respect should too !
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The U.S. may explore ways to ease trade tensions with China this week.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.

Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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 Russia’s Vladimir Putin coming to Washington in the fall ?  Is he running for office ?  He can count on support from the Republicans.
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
..
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

 

 

 

When Bull Ends, It Will Be Straight Down – All Algos Will Change to Sell at Same Time

INVESTORS first read.com – Daily edge before the open
DJIA: 25,822
S&P 500:2,862
Nasdaq Comp.:7,859
Russell 2000: 1,718

Wednesday, August 22, 2018    9:09 a.m.
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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
   
Where do I start ? 
     This bull market has ignored so many political bombshells.
      At some point, the Street will begin to panic about Republican control of both Houses, even the White House, though they will remain in control of the Supreme Court and Faux News forever.
      The S&P 500 topped the January highs posting an all-time high for this benchmark indicator. The more conservative DJIA has yet to follow suit.
       Trump longtime “fixer,” Michael Cohen, pleaded guilty to eight felonies yesterday and may soon cooperate with Special Counsel Robert Mueller, which could spell doom for the President, et al.
        Former Trump campaign manager, Paul Manafart, was found guilty of
on 8 criminal counts yesterday, and may also eventually cooperate with Mueller. He goes to trial again in September on separate charges.
        Will this news trigger a bear market ?
        I outline my reasons below why this 2009 to 2018 bull market has run its course, and think the implosion of the Trump administration (including VP Pence) and more will be the catalyst.  That will be hurried along by the gradual erosion  of this economic expansion.
     
The next round of tariffs on Chinese goods is scheduled to take effect Thursday to the tune of $16 billion.
      With trade talks between the U.S. and China expected to start this week, I wouldn’t be surprised if  that date would be postponed and used as a lever in the negotiations.  These are not high level talks, so all might be a ho hummer.
    Trump wants to meet with China’s president Xi Jinping in November.
     As noted below, the tariffs are adversely impacting a number of states.
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     If the DJIA and S&P 500 break above the January highs (DJIA: 26,616; S&P 500: 2,872) the financial press will go crazy, driving stock prices higher.
      Right now, the Street is betting on higher prices based on trade talks between the U.S. and China later this week.
       While the Nasdaq Comp. and Russell 2000 have broken their January peaks months ago, the DJIA and S&P 500 are more of an institutional investor benchmark.
        I think odds are 60-40 both DJIA and S&P 500 will breakout with much fanfare, but such a  stands to be an opportunity for the BIG money to ease toward the exit.
        It is hard to warn investors of  the risks of a bear market and recession when so much news is positive and everyone is bullish, but that is what happens at tops.
         People are human. At market tops, investors don’t think stock prices will ever stop rising. At bottoms, they don’t think they will ever stop falling – greed- fear.
        This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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Short squeeze in Treasuries ?  DoubleLine Capital’s Jeffrey Gundlach just informed  Bloomberg net short positions of the 10-year Treasuries hit their highest level on record raising the possibility of a short squeeze prompting big buying to cover shorts, ergo higner bond prices and lower yields, at least near-term.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales will be reported today at 10 o’clock, New Home Sales same time Thursday.
      What’s more, the Philly Fed general manufacturing conditions index (Mid-Atlantic region) is in a nosedive.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mameconoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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        The Fed will report  the minutes from its August 1 Federal Open Markets Committee (FOMC) meeting at 2 o’clock today and Fed chair Jerome Powell will deliver a speech about monetary policy Friday at the Fed’s annual meeting in Jackson Hole, Wyoming. 
      As I have warned repeatedly, The stock market turns down ahead of the beginning of a recession with a lead time of 3 to 12 months. My guess for this one is 12 months.
        One disadvantage of having personally experienced 13 bear markets is you see the warning signs well ahead of the  Street which is now staffed by decision makers many who haven’t seen more than one bull market tops – if that. 
        Bottom line – Ultra high risk – Cash reserve essential. When this one breaks, it will be straight down, starting out with a plunge of 12% – 18% in a matter of days.
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SUPPORT “today”:DJIA: 25,703; S&P 500:2,853;Nasdaq Comp.:7,827
RESISTANCE: “today” DJIA:25,751; S&P 500:2,856; Nasdaq Comp.:7,851
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RECENTLY
The Trump administration will pull all stops to hype the economy (and stock market) in coming months. Unless the market tanks, both will help Republicans in the mid-terms unless Trump, et al, crash in face of  a  relentless flow of  adverse news about corruption and abuse of power.
      August has the rep of being a nasty month for stocks. Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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RECENTLY
      There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Trump to put the U.S. on a war footing going into the elections to orchestrate patriotic support ?   Bomb Iran ? North Korea ? Washington Post ?
      We are seeing the late stages of a bull market and business expansion. The difference between this bull market and those in the past is it is so heavily computerized from stock selection to order execution. Most institutions will get a sell signal at the same time, resulting in a vertical plunge in stocks.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
         Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump Doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 32.8 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.24 vs.  an average of 1.49.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (109 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 110 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET
DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
       Maybe this administration and many supporters have no problem with lying being the new normal or truth alterantive, but I do, and every American with a smidgeon of self respect should too !
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The U.S. may explore ways to ease trade tensions with China this week.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.

Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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 Russia’s Vladimir Putin coming to Washington in the fall ?  Is he running for office ?  He can count on support from the Republicans.
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
..
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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 Tariffs for Thursday to be Postponed ?

INVESTORS first read.com – Daily edge before the open
DJIA: 25,758
S&P 500: 2,857
Nasdaq Comp.:7,821
Russell 2000: 1,698

Tuesday, August 21, 2018    9:09 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
   
I have little new to offer at this time, the following covers just about all the bases needed to touch today.
     The next round of tariffs on Chinese goods is scheduled to take effect Thursday to the tune of $16 billion.
      With trade talks between the U.S. and China expected to start this week, I wouldn’t be surprised if  that date would be postponed and used as a lever in the negotiations.  These are not high level talks, so all might be a ho hummer.
    Trump wants to meet with China’s president Xi Jinping in November.
     As noted below, the tariffs are adversely impacting a number of states.
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     If the DJIA and S&P 500 break above the January highs (DJIA: 26,616; S&P 500: 2,872) the financial press will go crazy, driving stock prices higher.
      Right now, the Street is betting on higher prices based on trade talks between the U.S. and China later this week.
       While the Nasdaq Comp. and Russell 2000 have broken their January peaks months ago, the DJIA and S&P 500 are more of an institutional investor benchmark.
        I think odds are 60-40 both DJIA and S&P 500 will breakout with much fanfare, but such a  stands to be an opportunity for the BIG money to ease toward the exit.
        It is hard to warn investors of  the risks of a bear market and recession when so much news is positive and everyone is bullish, but that is what happens at tops.
         People are human. At market tops, investors don’t think stock prices will ever stop rising. At bottoms, they don’t think they will ever stop falling – greed- fear.
        This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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Short squeeze in Treasuries ?  DoubleLine Capital’s Jeffrey Gundlach just informed  Bloomberg net short positions of the 10-year Treasuries hit their highest level on record raising the possibility of a short squeeze prompting big buying to cover shorts, ergo higner bond prices and lower yields, at least near-term.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales will be reported Wednesday at 10 o’clock, New Home Sales same time Thursday.
      What’s more, the Philly Fed general manufacturing conditions index (Mid-Atlantic region) is in a nosedive.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mameconoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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        The Fed will report  the minutes from its August 1 Federal Open Markets Committee (FOMC) meeting at 2 o’clock Wednesday and Fed chair Jerome Powell will deliver a speech about monetary policy Friday at the Fed’s annual meeting in Jackson Hole, Wyoming. 
      As I have warned repeatedly, The stock market turns down ahead of the beginning of a recession with a lead time of 3 to 12 months. My guess for this one is 12 months.
        One disadvantage of having personally experienced 13 bear markets is you see the warning signs well ahead of the  Street which is now staffed by decision makers many who haven’t seen more than one bull market tops – if that. 
        Bottom line – Ultra high risk – Cash reserve essential. When this one breaks, it will be straight down, starting out with a plunge of 12% – 18% in a matter of days.
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SUPPORT “today”:DJIA:25,667; S&P 500:2,851;Nasdaq Comp.:7,870
RESISTANCE: “today” DJIA:25,777; S&P 500:2,863; Nasdaq Comp.:7,843
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RECENTLY
The Trump administration will pull all stops to hype the economy (and stock market) in coming months. Unless the market tanks, both will help Republicans in the mid-terms unless Trump, et al, crash in face of  a  relentless flow of  adverse news about corruption and abuse of power.
      August has the rep of being a nasty month for stocks. Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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SUPPORT “today”:DJIA:; S&P 500:;Nasdaq Comp.:
RESISTANCE: “today” DJIA:; S&P 500:; Nasdaq Comp.:
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RECENTLY
      There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Trump to put the U.S. on a war footing going into the elections to orchestrate patriotic support ?   Bomb Iran ? North Korea ? Washington Post ?
      We are seeing the late stages of a bull market and business expansion. The difference between this bull market and those in the past is it is so heavily computerized from stock selection to order execution. Most institutions will get a sell signal at the same time, resulting in a vertical plunge in stocks.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
         Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump Doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 32.8 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.24 vs.  an average of 1.49.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (109 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 110 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET
DAMN  IT !   I miss decency.

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The U.S. may explore ways to ease trade tensions with China later in the month.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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Manafort – Hung Jury ??  Just takes one !
It really shouldn’t happen, he’s guilty.  While every juror is sworn to consider the facts of the case,  if one juror doesn’t see it that way or is an outright (or “closet”) Trump AINO, he/she could hang the jury (nullification). This jury is comprised of six men and six women out of a pool of 65, where the prosecutors and defense used most of their allowed “strikes” to challenge.
      As absurd as the possibility of a hung jury in this slam-dunk case is, ideological emotions  are running at a fever pitch. While the prosecution is trying Manafort on charges not directly related to Trump, every juror knows that a guilty verdict is a loss for Trump.
      Trump would tweet repeatedly that a hung jury was confirmation that  Mueller’s investigation is merely a witch hunt and should be terminated.
      The foundation that we are a nation of laws was seriously eroded on January 20, 2017.  Yes, hung juries (6% of criminal cases) are legal, but our republic will only survive if its leadership and citizens play by the rules.
      BUT MANAFORT IS BEING CHARGED WITH 18 CRIMES. IT IS UNLIKELY A JUROR WOULD FIND HIM GUILTY OF ALL 18 EVEN IF HE/SHE IS A TRUMP GROUPIE.
      Manafort will be tried in a different court in September for money laundering, jury tampering, and not registering as a foreign agent.
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.

 

Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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 Russia’s Vladimir Putin coming to Washington in the fall ?  Is he running for office ?  He can count on support from the Republicans.
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.

 

 

 

 

Street Betting on Trade Talks

INVESTORS first read.com – Daily edge before the open
DJIA: 25,669
S&P 500: 2,850
Nasdaq Comp.:7,816
Russell 2000: 1,692

Monday, August 20, 2018    9:09 a.m.

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 March 10, 2009 Special Bulletin (DJIA: 6,805) BUY !
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This volatility is EXACTLY what I meant when I Warned:
“2018: The Wildest One in Years.” December 27, 2017
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“No one is bearish, and that’s BEARISH…Odds favor a 12%-18% correction” – Jan. 22, 2018: DJIA:26,214.  (A 14-day 12.2% correction started 4 days later.)
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Trump – a human wrecking ball (1/3/17)
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What’s so Christian about favoring the rich over the poor ?

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“Accuse the other side of that which you are guilty.”
                                         Joseph Goebbels, Nazi propaganda minister.
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The Market Today
     If the DJIA and S&P 500 break above the January highs (DJIA: 26,616; S&P 500: 2,872) the financial press will go crazy, driving stock prices higher.
      Right now, the Street is betting on higher prices based on trade talks between the U.S. and China later this week.
       While the Nasdaq Comp. and Russell 2000 have broken their January peaks months ago, the DJIA and S&P 500 are more of an institutional investor benchmark.
        I think odds are 60-40 both DJIA and S&P 500 will breakout with much fanfare, but such a  stands to be an opportunity for the BIG money to ease toward the exit.
        It is hard to warn investors of  the risks of a bear market and recession when so much news is positive and everyone is bullish, but that is what happens at tops.
         People are human. At market tops, investors don’t think stock prices will ever stop rising. At bottoms, they don’t think they will ever stop falling – greed- fear.
        This from “The Motley Fool,” a highly respected advisory of growth stocks: Of the 10 recessions since 1950, the average time between the low point in the unemployment rate and the start of a recession was just 3.8 months.
      While a recession is generally defined as two consecutive declines in the GDP, it’s really not official until declared by the National Bureau of Economic Research (NBER), which reaches a decision in hindsight based on  income, employment, , industrial production, wholesale and retail sales. Recessions begin inconspicuously with erosions in several sectors of the economy then spreading to others. 
      Right now the auto and housing industries are showing signs of peaking.
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Short squeeze in Treasuries ?  DoubleLine Capital’s Jeffrey Gundlach just informed  Bloomberg net short positions of the 10-year Treasuries hit their highest level on record raising the possibility of a short squeeze prompting big buying to cover shorts, ergo higner bond prices and lower yields, at least near-term.
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We are getting mixed messages from the economy.  While employment is strong with jobless claims making historic lows, and retail sales up 6.4% (Y/Y), auto sales are flat-to-down this year. 
      Of particular concern is housing where high prices and mortgage rates, tariff-induced higher construction costs, and a shortage of skilled labor have hammered “starts”, as well as permits.
      Existing Home Sales will be reported Wednesday at 10 o’clock, New Home Sales same time Thursday.
      What’s more, the Philly Fed general manufacturing conditions index (Mid-Atlantic region) is in a nosedive.
       These are less obvious indicators that our economic recovery is  starting to break down. 
        Go to mameconoday.com for details. Do that every week. Good stuff –illustrations that make positive and negative points.
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        The Fed will report  the minutes from its August 1 Federal Open Markets Committee (FOMC) meeting at 2 o’clock Wednesday and Fed chair Jerome Powell will deliver a speech about monetary policy Friday at the Fed’s annual meeting in Jackson Hole, Wyoming. 
      As I have warned repeatedly, The stock market turns down ahead of the beginning of a recession with a lead time of 3 to 12 months. My guess for this one is 12 months.
        One disadvantage of having personally experienced 13 bear markets is you see the warning signs well ahead of the  Street which is now staffed by decision makers many who haven’t seen more than one bull market tops – if that. 
        Bottom line – Ultra high risk – Cash reserve essential. When this one breaks, it will be straight down, starting out with a plunge of 12% – 18% in a matter of days.
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SUPPORT “today”:DJIA:25,603; S&P 500:2,846;Nasdaq Comp.:7,796
RESISTANCE: “today” DJIA:25,757; S&P 500:2,863; Nasdaq Comp.:7,843
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RECENTLY
The Trump administration will pull all stops to hype the economy (and stock market) in coming months. Unless the market tanks, both will help Republicans in the mid-terms unless Trump, et al, crash in face of  a  relentless flow of  adverse news about corruption and abuse of power.
      August has the rep of being a nasty month for stocks. Bank of New York’s Simon Derrick, chief currency strategist, notes that since 1970,  seven of the 50 sharpest monthly drops occurred during August with an average decline of 8.9%.
       From the Aug. peaks, that would take the DJIA down to 23,406 9 (-2,286 pts.) to the Jan./Apr. lows, and the S&P 500 to 2,608 (-254 pts.), slightly above those lows.    
      The S&P 500 price to sales ratio is 40% higher than in 2007 before the devastating bear market, and is even higher than in March 2000 before the dot-com bubble burst leading to a bear market. Both bear markets dropped 50%.
       What’s more, The Shiller P/E runs at 32.8  times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is  considered “overvalued.”
       One disadvantage of having personally experienced 13 bear markets is you see these clues, early warning signs well ahead of the  Street which is now staffed by decision makers who haven’t seen more than one bull market tops – if that. 
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SUPPORT “today”:DJIA:; S&P 500:;Nasdaq Comp.:
RESISTANCE: “today” DJIA:; S&P 500:; Nasdaq Comp.:
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RECENTLY
      There are soft spots in our economy that should serve as  a warning. The ISM non-manufacturing Index slipped dramatically in July.
       Unit sales of vehicles is also trending down slipping to an annualized rate of  16.8 million vehicles per year from 17.2 million.
       Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 19.3%, as interest rates rise.
       Not only is it  major employer, its health affects other industries, especially furniture and appliances.
       Household debt increased for the 16th straight quarter to 13.3 trillion, that’s 19%  above the post-financial-crisis low.
      The job numbers are strong, companies are scrambling to fill slots they should have filled a year ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      Fed balance sheet unwinding is behind schedule for mortgage-backed securities (MBS) holdings.  Catchup may add upward pressure in interest rates.
      Jamie Dimon, CEO J.P. Morgan Chase,  thinks the benchmark  10-yearTreasury note , now 2.95%, should be 5%. The rate impacts lending for autos, mortgages and businesses.
      Trump to put the U.S. on a war footing going into the elections to orchestrate patriotic support ?   Bomb Iran ? North Korea ? Washington Post ?
      We are seeing the late stages of a bull market and business expansion. The difference between this bull market and those in the past is it is so heavily computerized from stock selection to order execution. Most institutions will get a sell signal at the same time, resulting in a vertical plunge in stocks.
      Personal loans have soared   18% to  a record 120 billion, Personal savings as percent of disposable income at 3%, down from 9% in 2012.
      Low interest rates have encouraged US companies to go on a debt binge, amassing  $6.3 trillion. With rates on the increase, refinance will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
 >Trump’s tariff tiff costing  US companies a bundle:
         Politico’s Doug Palmer noted in July  that Trump would have to have the U.S. government shell out $39 billion, $27 bil. in addition to the $12 bil. for farmers, if he wanted to cover the current cost of his tariff tiff.
         U.S. Chamber EVP, Neil Bradley, blogged yesterday that the damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
         More specifically, auto, parts and motorcycle mfrs. would need $7.6 bil.; chemical mfrs. $960 mil.; prepared food $884 mil.; fishermen/crabbers $822 mil.; soap mfrs. $725 mil. beverage mfrs. $765 mil.; shipbuilders $632 mil.; furniture mfrs. $567 mil.
       WSJ’s McGroaty and Tita pointed out yesterday that consumers are beginning to see higher prices on beverages, recreational vehicles and products sensitive to an increase  of 33% in steel and 11% in aluminum
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>Tax Cut and GDP jump Doesn’t help the average American. 
     
Vox’s Emily Stewart noted on July 29, that after tax cuts were enacted between Q1 and Q2, real wages fell 1.8%. Adjusted for inflation wages have fallen 9.3%.
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 Companies are buying back their own stock at a record clip, according to CNN Money.
      Why then are insiders selling $8 of stock for every $1 of stock they buy ?
       “They’re buying back from the front door, and shoveling shares out the back door,” says John Mousseau, CEO of Cumberland Advisers, a firm managing $3 billion.
      “Large US companies have become cash machines for top insiders who run them,” explains David Santschi, director of liquidity research at TrimTabs Research.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in 2017 and early 2018 found the percentage of insiders selling stock more than doubled immediately after buyback announcements.
      Buybacks  reward investors, and corporate executives whose  compensation is heavily leveraged in stock by supporting a stock’s price, as well as run it up higher.
The process inflates earnings by reducing shares outstanding. 
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BULLISH CASE
     
Corporate earnings are the only positive. Earnings reports will begin to flow in July and they will be good, 20%  for the S&P 500 over a year ago.
      But these earnings have been largely discounted by high stock prices. The Street will soon be looking out to 2019 when earnings increases will be 4% – 7%.
       Factset projects a Q2 earnings gain of  24.0%.
       Thomson Reuters pegs Q2 earnings gain at +21.5% and something a bit above +21% for the year as a whole . HOWEVER,  it presently projects Q1 2019  increase at +5.0%, Q2 at +7.2%. Q3: +9.3%. Could it be the 19% jump in 2018 earnings is already  factored into the market ?   
         If the Democrats gain control of the House or Senate, or both, it could offset the fact that  we are in a tailspin, financially, economically and morally. It could be a game changer, though we are heading for a recession.
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BEARISH CASE
RISING INTEREST RATES:
      The Fed is persistently raising its benchmark interest rate (federal funds), as well as reducing its inflated balance sheet,  which will drive other rates higher, which will adversely impact interest sensitive industries.  Banks will love it, but it will send shivers throughout the housing industry, which is reeling from the impact of tariff-induced higher lumber prices. 
      The 10-year treasury has been rising steadily and now stands at 2.856 %, it has recently been a smidge above 3%.
      Inflation is accelerating faster than expected with the core PCE rising to 2.0 in May, suggesting the Fed may ramp up its tightening. While  average  hourly earnings are not keeping pace, Friday’s Employment Report may show some catch up.
       The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
      Home prices have risen recouping most of losses incurred since the Great Recession, making houses even more unaffordable. Limited inventories of houses available for purchase is pushing prices higher.
      New buyers missed their once in a lifetime opportunity to buy when mortgage rates were at historic lows, they will have to pay-up to buy a house, if they can get the financing.
      OVERVALUED MARKET
     Thompson Reuters reports the S&P 500 sells at 19.1 times earnings and 16.7 times a year from now. All this versus a 10-year average of 14.3.
      The Shiller P/E runs much higher at 32.8 times earnings versus a mean of 16.9.  Shiller’s P/E is based on  inflation adjusted earnings over 10 years.
      The S&P 500 price to sales ratio is 2.24 vs.  an average of 1.49.  Before the 2007-2009 bear market it stood at 1.5 x.
      The Total Market Capitalization to GDP  stands at 147.3%, anything above 115% is “overvalued.”
       It looks like stock buy-backs are the only thing holding the market up. It was hoped that the 40% tax cut would trigger spending in capex.  Not yet, companies are buying back their own stock, pushing prices higher enhancing executive stock options.
       Corporate debt relative to GDP (45%) is higher now than before the 2007-2009 meltdown
       Corporations set a record in Q1, using benefits of tax cuts to buy back $189  billion of their own stock, beating the prior record of  $172 billion set in  the summer of 2007 right before the Great Bear Market/Recession.  This is a sign of speculative excess, as is a record amount of margin debt, investor borrowings to buy stock.
AGING BULL MARKET:
      The bull market is now  nine years and three months old (109 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      The current economic expansion has lasted 110 months. That’s 48 months (1.8x) longer that the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      The onset of bear markets have led the beginning of recessions by 8.5 months going back to 1956, so don’t look for a recession to signal a bear market. The longest lead time was 13 months (1968 – 1969) The “mode” (most frequent) is 12 months.
      1,100 economists WARN Trump is repeating biggest mistakes of Great Depression – tariffs, trade protectionism, according to conservative National Taxpayers’ Union.
      Former Fed Chair, Ben Bernanke, says economy to fall off a cliff in 2020, thanks to the $1.5 trillion corporate and individual tax cut and $300 billion increase in spending.              C
      Consumer spending slipped in May, as did Consumer Expectations and Consumer Confidence. It’s summer, maybe this slowing  is meaningless.
*******The Eurozone is in a slump. The IFO Business Climate Index has been soft all year, GDP is also sliding in face of a slump in retail sales.
      CNN.com reports Corporate America took advantage of low interest rates to load up on debt in recent years for acquisitions and to buy back their own stock. Excluding banks, the tally is $6.3trillion. The downside of this comes when these companies will need to refinance this debt at higher interest rates when it comes due.
      Existing home sales slumped in Q2, and are down in 5 of first 6 months
TRUMP’S TRADE WAR TANTRUM:
       He’s  a human wrecking ball, blustering without forethought of the consequences of  his actions. 
       Economists are minimizing the impact of  the flurry of tariffs, saying their impact is not significant. Perhaps when looking at the big picture but pain is being felt around the country as the stories roll in.
       This tariff jousting changes every several days.…..No one knows where this is going, and on top of aging economic expansions here and abroad, that’s scary.
        I crash-coursed this subject in recent days, as I  have done so many times with issues since Trump took office.   I am certain of one thing,  I do not know enough about this vast subject, nor could I condense what I know here to make any sense.
       What I do know is, today’s businesses are complex, especially supply chains that can involve a thousand parts that make up a whole product, many of which are sourced from different countries, sometimes crossing back and forth across the same border a number of times.
     Throw a wrench into the works and the gears start to gnash.  Managers are pressed to seek other sources, other outlets.  Efficiency and profitability begin to plummet.
      In fact, it doesn’t have to go that far.  Uncertain of the future, unable to plan, budgets get cut, sales orders construction projects cancelled, managers find planning more and more difficult.
      Enter the domino effect, and the pain spreads to other industries and finally to households threatened by unemployment, budgets there are cut, as well.   
      Trump’s hostility to globalization is ruining the U.S. as a place to do business, even invest.     
  
      Trump considering leaving World Trade Organization (WTO).
BREAKING: Trump and European Commission’s Jean-Claude Juncker agreed yesterday to hold off further tariffs and work toward eliminating present tariffs and barriers to trade
TRUMP ADMINISTRATION IMPLODING:
      Will he fire Rosenstein, then Mueller ?  Resign ? Create a series of constitutional crises ? Will, Mueller release devastating information about him ?
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POLITICAL/STOCK MARKET
DAMN  IT !   I miss decency.

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The U.S. may explore ways to ease trade tensions with China later in the month.  Considering the impact it is having on states, that would be a good idea heading into the midterm elections in November.
      The U.S. Chamber of Commerce estimates the impact of Trump tariffs on the following states stand to be: Louisiana ($5.2 bil.), Washington ($5.7 bil.), Texas ($1.4 bil.), S. Carolina ($2.6 bil.), Illinois ($2.1 bil.), California ($4.0 bil.), Kentucky ($917 mil.), Michigan (842 mil.), Ohio ($826 mil.).
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Trump revokes former CIA director, John Brennan’s security clearance, something that has never been done before.   Others under consideration, include James Comey, James Clapper.  (a dangerous precedent)
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Manafort – Hung Jury ??  Just takes one !
It really shouldn’t happen, he’s guilty.  While every juror is sworn to consider the facts of the case,  if one juror doesn’t see it that way or is an outright (or “closet”) Trump AINO, he/she could hang the jury (nullification). This jury is comprised of six men and six women out of a pool of 65, where the prosecutors and defense used most of their allowed “strikes” to challenge.
      As absurd as the possibility of a hung jury in this slam-dunk case is, ideological emotions  are running at a fever pitch. While the prosecution is trying Manafort on charges not directly related to Trump, every juror knows that a guilty verdict is a loss for Trump.
      Trump would tweet repeatedly that a hung jury was confirmation that  Mueller’s investigation is merely a witch hunt and should be terminated.
      The foundation that we are a nation of laws was seriously eroded on January 20, 2017.  Yes, hung juries (6% of criminal cases) are legal, but our republic will only survive if its leadership and citizens play by the rules.
      Manafort will be tried in a different court in September for money laundering, jury tampering, and not registering as a foreign agent.
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>Gaslighting: persistent psychological abuse technique used  to patiently establish control over another, ultimately causing that person to doubt themselves, their identity and self-worth. It involves persistent lying, denial of the truth, confusion, and projection  where they accuse a person of that which they are guilty. This is a classic  control mechanism.

Orwellian: George Orwell’s 1984 wretched society was controlled by denial of the truth,  misinformation, propaganda, and surveillance, i.e., Big Brother is watching.
“Just remember what you are seeing  and what you are reading is not what’s happening.” Trump to VFW July 24
“The party told you to reject the evidence of your eyes and ears…” George Orwell’s  dystopian novel – “1984”  published in 1949.
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>Should we be afraid of Trump’s base ?  Well, if you are wearing a Biden T-shirt at one of his rallies – YES  !
      But the numbers suggest otherwiseA recent Gallup poll shows  how  people polled  would vote if the election were held today
Democrats      30%
Republicans   26%

Independents 40%
      From what I gather many Independents are leaning Democrat, especially now that they see our treasured institutions undermined, time-tested global alliances traded in for sleeping with the enemy, the rule of law dissected piece by piece, and  the office of the Presidency disgraced by daily  lies.
       The best thing Republicans have going for them is the economy and less so, the stock market.  Voters tend to vote their pocketbooks.
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>Special Counsel Robert Mueller  must comply with regulations, rules, procedures, and policies of the Department of Justice as set forth in  28 CFR 600. He can only be removed for misconduct, dereliction of duty, incapacity, conflict of interest, or other good cause, including violation of the Department’s policies.

 

Trump has made 4,229 false (lies) and misleading claims since his inauguration, or an average of 7.6 per day- (Washington Post). Economic issues, trade, jobs account for 30% of these thoughtless utterances.
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What Trump and his base have in common: They both deplore the same people – people of color, the handicapped, liberals, foreigners.
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VOTES FLIPPED for TRUMP  in Key States in 2016
     
I am not  a conspiracy advocate, but I  suspect that not only did the Russians hack voter files, but they, or someone, tampered with the actual votes, also known as flipping.  Take one vote away from one candidate and give it to the other candidate and the net is two votes.
      Not to anyone’s surprise, Daily Kos’ Aldous Pennyfarthing (Pen name for Tom Breuer)  gave reasons in Alternet.org, July 27, why he thinks the Russians [or someone] flipped votes for Trump in 2016.
      The basis for this conclusion was comparing exit polls with actual out- come in North Carolina Pennsylvania, and Wisconsin.
      The differences between exit polls and the vote count in those states is pronounced.
Pennsylvania: Exit polls Clinton 50.5 – Trump 46.1.  Result: Clinton 46.1 –   Trump 48.8.
Wisconsin: Exit poll Clinton 48.2 – Trump 44.3  Result: Clinton 47.6 – Trump 48.8.
North Carolina: Exit poll Clinton  48.6 – Trump 46.5. Result: Clinton 46.1 – Trump 49.9.
      An FOI suit by Bradley Moss (cybersecurity lawyer) brought against the government  revealed Russians hacked inside voting systems in seven big states , which U.S. intelligence  denied at first then confirmed, but Homeland Security failed to report it to the states  for eight months.
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
  This is  a bloodless coup.
If  they can lock up control of both Houses, the Presidency, Supreme Court and strategic lower court appointments, and a major news media broadcaster, survival of our republic will depend on whose side the military and police forces take.  They already have a head start on internment camps
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 Sinclair Broadcast Group  (BEWARE !)   
      On July 16, 2018, Ajit Pai, appointed to FCC Chair by Trump, rejected  Sinclair’s acquisition of Tribune Broadcast Group which would greatly expand its reach into New York, La and Chicago markets with an addition of 42 more stations, saying he had serious concerns about the deal.
       Trump quickly criticized regulators for deferring their decision for the obvious reason, Sinclair is a right wing media  group  reportedly  intent on spreading its ideology across as much of America as possible.

      Sinclair Broadcast Group is using its clout as owner of  193 television stations as a lever to manipulate local station viewers’ minds pitching it’s right wing propaganda. Viewers tend to trust local stations programing over national networks.
       I called attention to this danger in my September 1, blog, warning that Sinclair’s reach to 80 markets gave it unfettered power. In recent days, Sinclair required news anchors in 200 of its local TV stations to warn viewers that unnamed media are always biased, and publishing fake news. This is a classic example of “projection” where one guilty of doing something wrong actually accuses another of that deed. Sinclair accuses liberal media of manipulation when in fact it is the one doing it.   EXPECT Sinclair to play a bunch of shell games to eventually get its way.
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      Sinclair Bank (no relation to the broadcast  group) has surfaced as a lender to Michael Cohen, Jared Kushner, his father and Trump.  Ivanka Trump no longer on board. 
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       U.S. Constitution: Article 3, section 3: Treason, briefly defined levying war against the U.S., or in adhering to its enemy, namely aid and comfort, also defined as any act that deliberately strengthens or tends to strengthen enemies of the U.S. or that weakens the power of the U.S. to resist and attack such enemies.
       Briefly, it requires a confession or matching testimony of two witnesses to conclude that an overt act occurred, but not to include “intent”. Congress decides one’s punishment.  
        Is Trump guilty of treason ?  Congressional Republicans that blatantly support him ?  
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TRUMP’S BASE:  Some are those voting because they always vote Republican, others hoped for a different outcome.  Then there are those whose opinions are based on emotional disorders, those who will never accept the truth no matter what (Confirmation Bias); those who accept bad behavior as the norm (Deviancy Down); and those who while stupid, ill informed who actually believe they are highly intelligent, competent (Dunning Krueger). These people don’t have enough knowledge to know they don’t have enough knowledge, i.e.,too dumb to know they are dumb.(alternet.com 7/23/18)
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 Russia’s Vladimir Putin coming to Washington in the fall ?  Is he running for office ?  He can count on support from the Republicans.
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July 19, 2018: Republicans refuse to renew election security funding over Russian hacking – Democrats livid, as all of us should be. Is this really happening ?  
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What !  John Bolton slashing Trump’s cybersecurity agent ?    Trump’s hawkish national security adviser is trying to abolish the role of special assistant to the president and cybersecurity coordinator held by Rob Joyce, according to someone who didn’t want their name disclosed.
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Follow this one closely: The Dept. of Justice charged a Russian national, Mariia Butina, of illegally trying to influence American politics using the NRA, religious organizations and the National Prayer Breakfast  as a means of gaining backchannel access to the highest levels of the Republican Party.  Mother Jones says  Butina acted as a covert Russian agent, an unregistered foreign agent, participating in a multiyear conspiracy to infiltrate conservative political groups, including the NRA. The depth of her ties to Republicans and the NRA appear to be significant.  According to USA Today, Russian billionaire, Konstantin Nikolaev provided funds for a gun rights group Butina started years ago.

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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needed to find someone in the Dept. Of Justice who would assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benszkowski was nominated by President Trump in June [2017] to be U.S. Assistant Attorney General for the Criminal Division. Along party lines, he was confirmed by the Senate recently, raising the question would he fire Mueller if Rosenstein was fired and he  was appointed in his place. He said he would not recuse himself from  questions in the Mueller investigation.
     The big question mark here is that Benczkowski had represented Russia’s Alfa Bank at some point in the past and had no prosecutorial experience.  He had worked for Atty Gen’l Jeff Sessions and the Bush administration and was not opposed by Rosenstein.

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A “MALEVOLENT FOOL” – Lt. Col. , Ret’d, Ralph Peters, ex-Fox analyst referring to Trump.   Malevolent: evil, harmful, injurious.
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Kavanaugh nominated for Supreme Court not to  overturn Roe v. Wade, but because he has written that a sitting President should be exempted from criminal prosecution, and investigation, including questioning by prosecutors.
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HEADS UP !   A majority vote in both the House and Senate can change the number of Justices on the Supreme Court. The number is fixed by statute, not by the Constitution. It has ranged between 6 and 10 since 1789.
       The question now is, will the Republicans attempt it to increase it in order to head off  any attempt by the Democrats in the future.
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Trump an agent of Russia ?  His actions suggest it. Read following:
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Un-American ! Trump claims writers of U.S. Constitution treated Him unfairly, adding we have the worst constitution writers in the world…Russia has better constitution writers than we do, says Trump . “I talked with Putin, and he said their constitution never gives him problems.” Andy Borowitz, (The Borowitz Report).
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      WE DON”T WANT TO GO THERE !  The Trump administration is taking the United States straight to a place none of us wants to be – civil unrest,  an extended recession, a fiscal crisis where we can’t pay our bills, ergo the need to slash healthcare, safety net programs, a host of programs that have improved our quality of life.
      This administration’s actions on trade (tariffs, TPP
), the intentional divisiveness of America along racial lines, and abandonment of our long-time allies have opened the door for China to dominate the world, economically and militarily.  That’s Un-American.  This has to be stopped.
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Republican strategist, Steve Schmidt, leaves Republican Party after 29 years, saying the party is “corrupt, indecent and immoral,” and with a few exceptions  elected  Republicans are “feckless cowards who disgrace and dishonor the legacies of the party’s greatest leaders.” Others quitting Republican Party: George Will, “Morning” Joe Scarborough. To date, 35 senior Trump advisers have left.
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Immigrants and separation: It’s 90% Stephen Miller, a Breitfart alum, and acknowledged racist.. Former senior vice president of public affairs at Duke University where Miller attended said, He is the most sanctimonious student I ever encountered…absolutely sure of his own views and correctness of them, and if you were in disagreement with him , there was something malevolent or stupid about your thinking.
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President Donald Trump is NOT pro-business, he’s pro-Trump
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TRUMP EXIT STRATEGY: The most important thing for King Donald is his image.  Currently he is scrambling to initiate as many perceived accomplishments as possible (taxes, anti-immigrant, anti-allies, deregulation, North Korea, Iran, ISIS, unemployment).
     
This way, if he is impeached, defeated in 2020, or forced to resign, he can claim to have been the greatest president of all-time – he’ll tweet it relentlessly, deviancy-downed Americans will believe it and every network in the country, whores that they are, (including MSNBC and CNN) will scramble to cover his tweets.  IMHO: he won’t risk losing in 2020, just not run – declare he has accomplished his mission and walk away..
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Wake up out there. These aren’t Republicans, they are anarchists, extremists  who have wrested control of the Republican party over the last 20 years and are intent on a party rule with no checks and balances.
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National security adviser, John Bolton, has added two  loyalists to the National Security Council, CNN reposts, referring to Sarah Tinsley and Garrett Marquis. Both have been associated with Bolton for years. Considered a hawk on international affairs, Bolton appears to be positioning his team to back up Trump in any military strike he sees would please his base, possibly in time for the midterm elections. Putting the country on a war footing tends to rally the country behind a president.
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POSSIBLE ! That the blue wave won’t happen in November.  Why? The American voter is still zoned out about what is happening – too busy with other stuff, not capable of  objectively analyzing issues accurately without bias.
     The result: The extremist Republicans and their president will run the economy, a constructive foreign relations policy, and America’s quality of life into the ground.  In order to get the American voter’s attention, we have to hit bottom first.
      That means an extended recession, a fiscal crisis (unable to pay bills), a 65% drop in the stock market and,  national unrest greater than that which the Vietnam War attracted.
       We are witnessing the unfolding of  the biggest scandal in our country’s history, including illegal financial transactions, vote tampering and  untethered collusion and obstruction of  justice at the highest level.  This may take years to unravel.
      Again, I say “possible,” not probable..  Probable would be all that but not as severe.
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Corporations got a 40% tax cut, John and Jane Q get a 1.2% – 1.8% cut, even so, Trump plans to introduce a “rescission package” to cut $15 billion in already approved spending on the Children’s Health Insurance Program (CHIP), the Center for Medicare and Medicaid Innovation program, as well as 30 other programs. The  U.S. House will likely approve his  rescission  package, the Senate may not.
ANOTHER TRUMP BLUNDER !
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According to Bloomberg.com, 1,100 economists warn that Trump is repeating one of the biggest mistakes of the Great Depression – tariffs and trade protectionism. The warning came in a letter from the conservative-leaning National Taxpayers Union.
      China loves it !  Trump opened the door, China entered, capitalizing on Trump’s regressive “America First” mantra, with its far reaching Belt and Road outreach with investments encompassing infrastructure, education, construction materials, rail and hi-way, auto, real estate, power grid and iron and steel investments to 68 countries, 65% of the world’s population and 40% of global GDP.
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      Kim took Trump’s war with North Korea option off the table, so looks like Trump now has his sights set on IRAN – to please his base, of course, in time for the mid-terms, of course.
      None of this would happen if we still had the military draft.
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North Korea give up nuclear weapons ?  Never !  Kim wants a global stage, so does Trump, who will not risk being embarrassed by the little tyrant. Trump will bail.  He needs a villain to trash to please his base. Kim has what he wants, the recognition as a nuclear power, and he can thank a blundering Trump for it. If Trump deserves credit for the recent lovefest between the two Koreas, then is entitled to it.  Currently, he is taking 100% credit.  I think he has been played like a harp.  
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Impeachment of Trump unlikely with this Republican House. Trump has surrounded himself with newly appointed Cabinet members, so Section 4 of the 25th amendment is not a reality.   What’s left ?  A deal with Mueller for his RESIGNATION ?
      He could
tweet forever how he accomplished tax cuts, deregulation, a big spend on the military. He could claim that though he was mistreated by the press, he will still go down in history as the best President ever.
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Must Read: “Will Christian Nationalism Drive Trump’s Base to the Polls in November ?”  Truthout April 15, Bill Berkowitz. This explains why his base of Christians votes for an immoral person, one whose behavior is the antithesis of the teachings of Christ.
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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.  Nixon did it in 1973 when he had to work through two attorney generals until  his solicitor general, Robert Bork fired Special Prosecutor Archibald Cox. 
     
Deputy Attorney General Rod Rosenstein isn’t going to do it, so Trump must find someone from DOJ , or someone outside who has already been confirmed by the Senate who will do it.  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)      
       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 and may be a valuable source of information for the FBI, since he had an inside view.     
      Unconfirmed rumors are that EPA’s Scott Pruit (already confirmed) has shown an interest in the DOJ, is a possibility for a post there.  We now know that is a stretch given the baggage he carries. Attorney General Jeff Sessions has recused himself from the Russian/Trump  “investigation” March 2017.
       Philip Bump, Washington Post (WAPO) April 10, did a great job outlining possibilities in, “Why Trump can’t fire Mueller – at least not directly.”  I can only touch on a few of his points here.
       In his article, Georgetown University’s professor Paul Butler raises the interesting point that  firing Mueller may not be necessary if  Rosenstein is replaced by someone hostile to the Special Counsel’s investigation.  He would simply force a stall with lots of demands, even leak information to the White House.   
       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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FISCAL CRISIS LOOMS IN FUTURE:  Headlines:“Federal debt primed to explode”….”U.S. Deficit to Surpass $1 Trillion Two Years Ahead of Estimates”….”This Year’s budget deficit to hit $804 B after tax cuts and spending hikes”….
       This is all a Republican scheme to justify massive spending cuts to social, health, educational  and safety net programs. It is called “Starving the Beast,” and will lead to debilitating and prolonged recession/bear market, increased crime, rioting and civil unrest.  Republicans set the stage with massive, unnecessary tax cuts and a big budget spend (see below: “Corporate Tax Cut Irresponsible”)
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Cambridge Analytica (now in bankruptcy) 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 back on June 22, 2017,  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.  While Aggregate denies any connection,  the story won’t go away. Palmer sees a connection between Cambridge and John Bolton’s SUPER PAC.  Palmer notes that UK Parliament is investigating  the connection between Cambridge and Brexit and documents referred to by Cambridge whistleblower Christopher Wylie reveal  the firm gave stolen Facebook  user data to Bolton’s PAC  (receiving stolen goods ?), though it is not known how Bolton used the data if his PAC even received it.  (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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Another name to watch is Ted Malloch who Palmer.com reports was served a subpoena relating to the Trump/Russia probe.  Malloch is a U. S. citizen living in London with close tire to Roger Stone, Brexit leader Nigel Farage and the Trump campaign.  As noted above in Cambridge Analytica, there is a connection to parties involved in Brexit and Trump’s campaign.
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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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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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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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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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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Red states In need of Fed government help the most

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 response.
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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 – Ted Malloch -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

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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.