Chaos ! More To Come

INVESTORS  first read.com – Daily edge before the open       
DJIA:26,439
S&P 500: 2,914
Nasdaq Comp.:8,041
Russell 2000:1,690
Friday, September 28,  2018   8:58 a.m
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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
       The market will open on the downside, as chaos in the highest offices of  our government increase.  To date, the Street could care less, but  CONFIDENCE in the future eventually rules.
       Yesterday’s bizarre Supreme Court nomination process of  candidate Brett Kavanau is just one example.  The highest court in the land, this person with all the doubts from his past ? Every decision he renders will be tainted, as have been every decision of this Republican-controlled government.
      That spells trouble; that indicates multiple constitutional crises in the future, civil unrest, and for the economy.
       All this adds up to  a burst of the bubble, the myth that  tax cuts are good for America, when in reality we are facing a fiscal crisis never experienced in our country, one where we can’t pay our bills unless we gut all the social programs (Social Security, Medicare, Medicaid, etc.) to  just survive.
       What’s so un-American is this is the design of the extremist Republican Party, it has been waiting for control of the White House, both Houses of Congress, the Supreme Court and a news channel with a big following to destroy safety nets.
      Why ?  They want it all for themselves.

       I have said this hundreds of times, when this market corrects or enters a bear market it will be straight down, giving investors zero chance to react.  Expect the next major drop to be 12% to 18%. At that point, a further drop depends on what new news hits it.   

       I have mixed feelings about October. It has featured some outright ugly plunges in prices, yet has hosted the bottoms of bear markets in 1987, 1990, 1998, and 2002.
      With what is going on right now, I suspect we will see a scary plunge into October and excessive volatility heading into the midterm elections.  
      The Street is hanging tough, hopeful that “Tax Reform 2.0 will make tax cuts for corporations permanent.  Unfortunately for the rest of America that would ensure a monstrous fiscal crisis down the road when the United States cannot pay its bills due to a shortfall in revenues, resulting in huge cuts to programs that so many Americans rely on now.
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      While the nationwide angst caused by Watergate contributed to the 50% drop in the S&P 500 in the 1973-1974 bear market, other factors contributed as well – OPEC Oil Embargo causing a huge spike in oil prices and long waits at the gas pump, Yum Kippur War, start of a recession (11/73), and Nixon’s resignation.
       Today, we have a constitutional crisis before our eyes, with the potential of destroying the upper echelons  of the Trump administration and core of the Republican Party, a trade war escalating, the Fed raising interest rates, war at any time a risk, and late stage economic expansions  aging bull  market to consider.
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       No one wants to look at the warning signs, not while money is so easily made with the promise of more to come.  The warning signs are all there (see below “Bearish,”),  but it is now a question of how much more overpriced can stocks get ?
        I thought stocks were overvalued a long time ago – and they were, but speculative fever is hard to measure when it  is out of control.
        A change in direction can be caused by an event, or a change in the buy sell  ratio, BIG money cutting back on buying and actually taking profits.
                  Yes, the market can go higher. Is new buying worth the risk ?  Why not a nice cash position (30% -40%) just in case  the majority of investors are wrong, too blinded by “fever” to see the risk ?  At extremes, CASH is an investment.
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NOTE: Through September, this bull market is 114 months old, or 3.75 times longer than the average.
>Bear markets start 6 – 12 months ahead of the onset of a recession.        

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SUPPORT “today”:DJIA:26,271;S&P 500:2,897;Nasdaq Comp.:7,981
RESISTANCE: “today” DJIA:26,466; S&P:2,916; Nasdaq Comp.:8,046
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HIGHLIGHTS – Stock Market/Economy
   Odds are there will not be a new NAFTA agreement signed before this weekend’s deadline  with Canada ( third behind China as a U.S. trading partner) holding out on a number of issues.  Trump may go to Congress to get approval for a new NAFTA including Mexico, but excluding Canada, then trash our dearest ally for not caving to his demands. 
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  The Federal Open Market Committee (FOMC)  has a policy announcement 2:00 p.m., Wednesday
followed by a press conference at 2:30 with Fed Chair Jerome Powell. The Fed is expected to bump its benchmark federal funds rate up a quarter point to 2.00% – 2.25%.
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       Of particular importance this week are:  New Home Sales (Wed. 10:00 a.m.)Pending Home Sales  (Thur. 10:00 a.m.).  Housing is one of our economy’s biggest drags.
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       Tax Reform 2.0
  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people and reduce federal government receipts by up to $3 trillion in the future.
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      The Trump administration will levy 10% tariffs on approximately $200        billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
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David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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HIGHLIGHTS – POLITICAL
     Projection defined  as  the other person of     that which you are guilty of.

Example:  Trump referred to the press’ assault on Supreme Court Nominee, Bret Kavanua as a “Big fat con job.”  WRONG !     The big fat con job is Trump.
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Deputy Attorney General Rod Rosenstein will meet with Trump tomorrow amid speculation that he will be fired or resign following last Friday’s New York Times article alleging he made comments in a May 2017 meeting about wearing a wire to record meetings with Trump, as well as referring to the 25th Amendment, which under certain circumstances could be used to remove a President from office.  Rosenstein denies he was serious, just being sarcastic.
      It is common knowledge to anyone paying attention, that Trump must do something to head off the Mueller Commission’s investigation, and this may give him a chance to do that by firing Rosenstein and replacing him with someone who would fire Special Counsel Robert Mueller or who would impede the investigation.
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Kavanaugh’s prospects dimming
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      The number of  Supreme Court Justices is not fixed at nine by Article III of the U.S. Constitution.    Reportedly, a majority  vote by both Houses can change the number of Justices on the Supreme Court. ……………………………………………………………….
      Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.   Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.
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Remember the name of Brian Benczkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%.
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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.  . 
      >The 10-year treasury has been rising steadily and now stands at 3.09%.
      > The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
 OVERVALUED MARKET
      > 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.
       > If companies are buying back their own stock at a record clip, pushing stocks higher, why then are insiders selling $8 of stock for every $1 of stock they buy ?
       .> Companies 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.
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       > The S&P 500 price to sales ratio at 2.30 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%.
       > The Shiller P/E is 33.5  times earnings versus a mean of 16.6.  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.”
        > 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.
AGING BULL MARKET:
       > The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      > Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      > The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      > 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. 
      > Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 20.5%, 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.
      > 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      > Recently, 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.              
TRUMP’S TRADE WAR TANTRUM
      > Trump’s tariff tiff costing  US companies a bundle:  The damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
      > 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.
      >  Trump is considering leaving World Trade Organization (WTO).
TRUMP ADMINISTRATION IMPLODING:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
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POLITICAL/STOCK MARKET

Kavanaugh is burnt toast !
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     Reportedly a fourth Kavanaugh accuser is coming forth, a woman with multiple security clearances, suggesting she has already been vetted by the FBI.
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including a Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford: teaches graduate students in clinical psychology at Palo Alto University.  In July, she passed a polygraph test administered by the FBI.      Married with young children, Dr. Ford has been viciously harassed, her computer hacked, her life threatened, and forced to  move her family out of her home as result of coming forward. She insists the FBI conduct a an investigation into the matter before she comes forward
however, her allegation is not a federal crime, so the only way the FBI can get involved is if Trump requests it – Ha !
        A classmate posted to social media that she remembers chatter about the incident at school shortly after it happened.
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullified by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (Washington Post). …………………………………………………………………   
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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Trump boasts about the stock market in his first 31 months as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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The U.S. Chamber of Commerce currently 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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then too, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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 outcome in North Carolina Pennsylvania, and Wisconsin.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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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        Treason is defined by Article 3, section 3: Treason, as 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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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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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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller,   assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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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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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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 ?) …………………………………………….
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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bulls CANNOT Afford a Rally Failure Here

INVESTORS first read.com – Daily edge before the open       
DJIA: 26385
S&P 500: 2,905
Nasdaq Comp.:7,990
Russell 2000: 1,691
Thursday, September 27,  2018   9:11 a.m.

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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
       Just another three-day correction, or the beginning of something more significant  ?  Bulls cannot afford a rally failure here where a rise in prices fails to hold and the market closes at the lows for the day.                                                                                                                         Odds of an October crunch just increased with yesterday’s drop in prices. It was small and seemingly insignificant, but the four major market averages (DJIA, S&P 500, Nasdaq Comp. and Russell 2000 should not have been able to drop down through a level that should have found buyers.
        It was a tiny glitch, which I detected on the 2-day charts of the major market averages that didn’t show up in the 3-month two charts. It may mean nothing, but needs to be pointed out just in case it is a sign buyers quietly left.  The DJIA effortlessly plunged 200 points in the last hour of trading.
       I have said this hundreds of times, when this market corrects or enters a bear market it will be straight down, giving investors zero chance to react.  Expect the next major drop to be 12% to 18%. At that point, a further drop depends on what new news hits it.    

       I have mixed feelings about October. It has featured some outright ugly plunges in prices, yet has hosted the bottoms of bear markets in 1987, 1990, 1998, and 2002.
      With what is going on right now, I suspect we will see a scary plunge into October and excessive volatility heading into the midterm elections.  
      The Street is hanging tough, hopeful that “Tax Reform 2.0 will make tax cuts for corporations permanent.  Unfortunately for the rest of America that would ensure a monstrous fiscal crisis down the road when the United States cannot pay its bills due to a shortfall in revenues, resulting in huge cuts to programs that so many Americans rely on now.
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      While the nationwide angst caused by Watergate contributed to the 50% drop in the S&P 500 in the 1973-1974 bear market, other factors contributed as well – OPEC Oil Embargo causing a huge spike in oil prices and long waits at the gas pump, Yum Kippur War, start of a recession (11/73), and Nixon’s resignation.
       Today, we have a constitutional crisis before our eyes, with the potential of destroying the upper echelons  of the Trump administration and core of the Republican Party, a trade war escalating, the Fed raising interest rates, war at any time a risk, and late stage economic expansions  aging bull  market to consider.
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       No one wants to look at the warning signs, not while money is so easily made with the promise of more to come.  The warning signs are all there (see below “Bearish,”),  but it is now a question of how much more overpriced can stocks get ?
        I thought stocks were overvalued a long time ago – and they were, but speculative fever is hard to measure when it  is out of control.
        A change in direction can be caused by an event, or a change in the buy sell  ratio, BIG money cutting back on buying and actually taking profits.
                  Yes, the market can go higher. Is new buying worth the risk ?  Why not a nice cash position (30% -40%) just in case  the majority of investors are wrong, too blinded by “fever” to see the risk ?  At extremes, CASH is an investment.
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NOTE: Through September, this bull market is 114 months old, or 3.75 times longer than the average.
>Bear markets start 6 – 12 months ahead of the onset of a recession.        

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SUPPORT “today”:DJIA:26,210;S&P 500:2,901;Nasdaq Comp.:7,937
RESISTANCE: “today” DJIA:26,438; S&P:2,909; Nasdaq Comp.:8,001
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HIGHLIGHTS – Stock Market/Economy
   Odds are there will not be a new NAFTA agreement signed before this weekend’s deadline  with Canada ( third behind China as a U.S. trading partner) holding out on a number of issues.  Trump may go to Congress to get approval for a new NAFTA including Mexico, but excluding Canada, then trash our dearest ally for not caving to his demands. 
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  The Federal Open Market Committee (FOMC)  has a policy announcement 2:00 p.m., Wednesday
followed by a press conference at 2:30 with Fed Chair Jerome Powell. The Fed is expected to bump its benchmark federal funds rate up a quarter point to 2.00% – 2.25%.
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       Of particular importance this week are:  New Home Sales (Wed. 10:00 a.m.)Pending Home Sales  (Thur. 10:00 a.m.).  Housing is one of our economy’s biggest drags.
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       Tax Reform 2.0
  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people and reduce federal government receipts by up to $3 trillion in the future.
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      The Trump administration will levy 10% tariffs on approximately $200        billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
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David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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HIGHLIGHTS – POLITICAL
     Projection defined  as  the other person of     that which you are guilty of.

Example:  Trump referred to the press’ assault on Supreme Court Nominee, Bret Kavanua as a “Big fat con job.”  WRONG !     The big fat con job is Trump.
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Deputy Attorney General Rod Rosenstein will meet with Trump tomorrow amid speculation that he will be fired or resign following last Friday’s New York Times article alleging he made comments in a May 2017 meeting about wearing a wire to record meetings with Trump, as well as referring to the 25th Amendment, which under certain circumstances could be used to remove a President from office.  Rosenstein denies he was serious, just being sarcastic.
      It is common knowledge to anyone paying attention, that Trump must do something to head off the Mueller Commission’s investigation, and this may give him a chance to do that by firing Rosenstein and replacing him with someone who would fire Special Counsel Robert Mueller or who would impede the investigation.
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Kavanaugh’s prospects dimming
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      The number of  Supreme Court Justices is not fixed at nine by Article III of the U.S. Constitution.    Reportedly, a majority  vote by both Houses can change the number of Justices on the Supreme Court. ……………………………………………………………….
      Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.   Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.
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Remember the name of Brian Benczkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%.
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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.  . 
      >The 10-year treasury has been rising steadily and now stands at 3.09%.
      > The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
 OVERVALUED MARKET
      > 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.
       > If companies are buying back their own stock at a record clip, pushing stocks higher, why then are insiders selling $8 of stock for every $1 of stock they buy ?
       .> Companies 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.
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       > The S&P 500 price to sales ratio at 2.30 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%.
       > The Shiller P/E is 33.5  times earnings versus a mean of 16.6.  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.”
        > 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.
AGING BULL MARKET:
       > The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      > Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      > The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      > 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. 
      > Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 20.5%, 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.
      > 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      > Recently, 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.              
TRUMP’S TRADE WAR TANTRUM
      > Trump’s tariff tiff costing  US companies a bundle:  The damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
      > 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.
      >  Trump is considering leaving World Trade Organization (WTO).
TRUMP ADMINISTRATION IMPLODING:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
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POLITICAL/STOCK MARKET

Kavanaugh is burnt toast !
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     Reportedly a fourth Kavanaugh accuser is coming forth, a woman with multiple security clearances, suggesting she has already been vetted by the FBI.
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including a Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford: teaches graduate students in clinical psychology at Palo Alto University.  In July, she passed a polygraph test administered by the FBI.      Married with young children, Dr. Ford has been viciously harassed, her computer hacked, her life threatened, and forced to  move her family out of her home as result of coming forward. She insists the FBI conduct a an investigation into the matter before she comes forward
however, her allegation is not a federal crime, so the only way the FBI can get involved is if Trump requests it – Ha !
        A classmate posted to social media that she remembers chatter about the incident at school shortly after it happened.
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullified by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (Washington Post). …………………………………………………………………   
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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Trump boasts about the stock market in his first 31 months as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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The U.S. Chamber of Commerce currently 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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then too, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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 outcome in North Carolina Pennsylvania, and Wisconsin.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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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        Treason is defined by Article 3, section 3: Treason, as 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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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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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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller,   assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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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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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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 ?) …………………………………………….
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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fed to Raise Rates for the 8th

INVESTORS  first read.com – Daily edge before the open       
DJIA: 26,492
S&P 500: 2,915
Nasdaq Comp.:8,007
Russell 2000: 1,708
Wednesday, September 26,  2018   9:11 a.m.

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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
      I have mixed feelings about October. It has featured some outright ugly plunges in prices, yet has hosted the bottoms of bear markets in 1987, 1990, 1998, and 2002.
      With what is going on right now, I suspect we will see a scary plunge into October and excessive volatility heading into the midterm elections.   
      The Street is hanging tough, hopeful that “Tax Reform 2.0 will make tax cuts for corporations permanent.  Unfortunately for the rest of America that would ensure a monstrous fiscal crisis down the road when the United States cannot pay its bills due to a shortfall in revenues, resulting in huge cuts to programs that so many Americans rely on now.
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      While the nationwide angst caused by Watergate contributed to the 50% drop in the S&P 500 in the 1973-1974 bear market, other factors contributed as well – OPEC Oil Embargo causing a huge spike in oil prices and long waits at the gas pump, Yum Kippur War, start of a recession (11/73), and Nixon’s resignation.
       Today, we have a constitutional crisis before our eyes, with the potential of destroying the upper echelons  of the Trump administration and core of the Republican Party, a trade war escalating, the Fed raising interest rates, war at any time a risk, and late stage economic expansions  aging bull  market to consider.
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       No one wants to look at the warning signs, not while money is so easily made with the promise of more to come.  The warning signs are all there (see below “Bearish,”),  but it is now a question of how much more overpriced can stocks get ?
        I thought stocks were overvalued a long time ago – and they were, but speculative fever is hard to measure when it  is out of control.
        A change in direction can be caused by an event, or a change in the buy sell  ratio, BIG money cutting back on buying and actually taking profits.
                  Yes, the market can go higher. Is new buying worth the risk ?  Why not a nice cash position (30% -40%) just in case  the majority of investors are wrong, too blinded by “fever” to see the risk ?  At extremes, CASH is an investment.
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NOTE:
>The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
>Bear markets start 6 – 12 months ahead of the onset of a recession        

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SUPPORT “today”:DJIA:26,401; S&P 500:2,912;Nasdaq Comp.:7,996
RESISTANCE: “today” DJIA:26,513; S&P:2,917; Nasdaq Comp.:8,028
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HIGHLIGHTS – Stock Market/Economy
   Odds are there will not be a new NAFTA agreement signed before this weekend’s deadline  with Canada ( third behind China as a U.S. trading partner) holding out on a number of issues.  Trump may go to Congress to get approval for a new NAFTA including Mexico, but excluding Canada, then trash our dearest ally for not caving to his demands. 
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  The Federal Open Market Committee (FOMC)  has a policy announcement 2:00 p.m., Wednesday
followed by a press conference at 2:30 with Fed Chair Jerome Powell. The Fed is expected to bump its benchmark federal funds rate up a quarter point to 2.00% – 2.25%.
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       Of particular importance this week are:  New Home Sales (Wed. 10:00 a.m.)Pending Home Sales  (Thur. 10:00 a.m.).  Housing is one of our economy’s biggest drags.
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       Tax Reform 2.0
  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people and reduce federal government receipts by up to $3 trillion in the future.
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      The Trump administration will levy 10% tariffs on approximately $200        billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
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David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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HIGHLIGHTS – POLITICAL
      Deputy Attorney General Rod Rosenstein will meet with Trump tomorrow amid speculation that he will be fired or resign following last Friday’s New York Times article alleging he made comments in a May 2017 meeting about wearing a wire to record meetings with Trump, as well as referring to the 25th Amendment, which under certain circumstances could be used to remove a President from office.  Rosenstein denies he was serious, just being sarcastic.
      It is common knowledge to anyone paying attention, that Trump must do something to head off the Mueller Commission’s investigation, and this may give him a chance to do that by firing Rosenstein and replacing him with someone who would fire Special Counsel Robert Mueller or who would impede the investigation.
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Kavanaugh’s prospects dimming
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      The number of  Supreme Court Justices is not fixed at nine by Article III of the U.S. Constitution.    Reportedly, a majority  vote by both Houses can change the number of Justices on the Supreme Court. ……………………………………………………………….
      Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.   Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.
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Remember the name of Brian Benczkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%.
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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.  . 
      >The 10-year treasury has been rising steadily and now stands at 3.09%.
      > The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
 OVERVALUED MARKET
      > 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.
       > If companies are buying back their own stock at a record clip, pushing stocks higher, why then are insiders selling $8 of stock for every $1 of stock they buy ?
       .> Companies 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.
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       > The S&P 500 price to sales ratio at 2.30 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%.
       > The Shiller P/E is 33.5  times earnings versus a mean of 16.6.  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.”
        > 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.
AGING BULL MARKET:
       > The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      > Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      > The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      > 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. 
      > Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 20.5%, 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.
      > 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      > Recently, 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.              
TRUMP’S TRADE WAR TANTRUM
      > Trump’s tariff tiff costing  US companies a bundle:  The damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
      > 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.
      >  Trump is considering leaving World Trade Organization (WTO).
TRUMP ADMINISTRATION IMPLODING:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
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POLITICAL/STOCK MARKET

Kavanaugh is burnt toast !
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     Reportedly a fourth Kavanaugh accuser is coming forth, a woman with multiple security clearances, suggesting she has already been vetted by the FBI.
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including a Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford: teaches graduate students in clinical psychology at Palo Alto University.  In July, she passed a polygraph test administered by the FBI.      Married with young children, Dr. Ford has been viciously harassed, her computer hacked, her life threatened, and forced to  move her family out of her home as result of coming forward. She insists the FBI conduct a an investigation into the matter before she comes forward
however, her allegation is not a federal crime, so the only way the FBI can get involved is if Trump requests it – Ha !
        A classmate posted to social media that she remembers chatter about the incident at school shortly after it happened.
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullified by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (Washington Post). …………………………………………………………………   
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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Trump boasts about the stock market in his first 31 months as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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The U.S. Chamber of Commerce currently 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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then too, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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 outcome in North Carolina Pennsylvania, and Wisconsin.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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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        Treason is defined by Article 3, section 3: Treason, as 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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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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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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller,   assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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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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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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 ?) …………………………………………….
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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Constitutional Crisis Unfolding – Beware

INVESTORS first read.com Daily edge before the open       
DJIA:  26,562
S&P 500: 2,919
Nasdaq Comp.:7,993
Russell 2000: 1,705
Tuesday, September 25,  2018   9:17 a.m.

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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
 “Stocks at Records-Dow beats all-time high of January”
– Market Watch – September 20, 2018.     
      For over  year I have warned of a huge constitutional
a “Friday Night Massacure II,” as Trump seeks to rearrange the Department of Justice  so it is more accommodative to his whims.  The end game here is to find a way to impede progress or stop to the Special Counsel’s investigation  into his administration and Trump himself.
      So far, the Street could care less, which suggests the decision makers haven’t programmed their algorithms to respect what a sudden plunge in confidence in the future  can do to stock prices.
      My guess is  90% of the Street’s decision makers were not around for Watergate, which was chump change compared with what we are dealing with today.
      While the nationwide angst caused by Watergate contributed to the 50% drop in the S&P 500 in the 1973-1974 bear market, other factors contributed as well – OPEC Oil Embargo causing a huge spike in oil prices and long waits at the gas pump, Yum Kippur War, start of a recession (11/73), and Nixon’s resignation.
       Today, we have a constitutional crisis before our eyes, with the potential of destroying the upper echelons  of the Trump administration and core of the Republican Party, a trade war escalating, the Fed raising interest rates, war at any time a risk, and late stage economic expansions  aging bull  market to consider.
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       No one wants to look at the warning signs, not while money is so easily made with the promise of more to come.  The warning signs are all there (see below “Bearish,”),  but it is now a question of how much more overpriced can stocks get ?
        I thought stocks were overvalued a long time ago – and they were, but speculative fever is hard to measure when it  is out of control.
        A change in direction can be caused by an event, or a change in the buy sell  ratio, BIG money cutting back on buying and actually taking profits.
        Odds favor a spike up will be followed by a sharp correction of 5% -10% followed by a rally that looks like another leg to new highs.
          That is the killer rally, because it sucks in all those who still have cash in reserve.  The next leg down  takes the market down 12% – 18% from the all-time highs.  At that point, further downside depends on what new news hits the market.  That is when a correction becomes a bear market.
          Yes, the market can go higher. Is new buying worth the risk ?  Why not a nice cash position (30% -40%) just in case  the majority of investors are wrong, too blinded by “fever” to see the risk ?  At extremes, CASH is an investment.
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NOTE:
>The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
>Bear markets start 6 – 12 months ahead of the onset of a recession        

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SUPPORT “today”:DJIA:26,443 ; S&P 500:2,906;Nasdaq Comp.:7,954
RESISTANCE: “today” DJIA:26,628; S&P:2.926; Nasdaq Comp.:8,011
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HIGHLIGHTS – Stock Market/Economy
       The Federal Open Market Committee (FOMC)  has a policy announcement 2:00 p.m., Wednesday followed by a press conference at 2:30 with Fed Chair Jerome Powell. The Fed is expected to bump its benchmark federal funds rate up a quarter point, currently at 2.00%.
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       Of particular importance this week are: FHFA House Price Index (Tues. 9:00 a.m.), New Home Sales (Wed. 10:00 a.m.)Pending Home Sales  (Thur. 10:00 a.m.).  Housing is one of our economy’s biggest drags.
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       Tax Reform 2.0
  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people and reduce federal government receipts by up to $3 trillion in the future.
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      The Trump administration will levy 10% tariffs on approximately $200        billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
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David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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HIGHLIGHTS – POLITICAL

Kavanaugh’s prospects dimming
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      The number of  Supreme Court Justices is not fixed at nine by Article III of the U.S. Constitution.    Reportedly, a majority  vote by both Houses can change the number of Justices on the Supreme Court. ……………………………………………………………….
      Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.   Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.
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Remember the name of Brian Benczkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%.
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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.  . 
      >The 10-year treasury has been rising steadily and now stands at 3.09%.
      > The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
 OVERVALUED MARKET
      > 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.
       > If companies are buying back their own stock at a record clip, pushing stocks higher, why then are insiders selling $8 of stock for every $1 of stock they buy ?
       .> Companies 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.
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       > The S&P 500 price to sales ratio at 2.30 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%.
       > The Shiller P/E is 33.5  times earnings versus a mean of 16.6.  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.”
        > 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.
AGING BULL MARKET:
       > The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      > Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      > The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      > 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. 
      > Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 20.5%, 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.
      > 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      > Recently, 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.              
TRUMP’S TRADE WAR TANTRUM
      > Trump’s tariff tiff costing  US companies a bundle:  The damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
      > 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.
      >  Trump is considering leaving World Trade Organization (WTO).
TRUMP ADMINISTRATION IMPLODING:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
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POLITICAL/STOCK MARKET

Kavanaugh is burnt toast !
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including a Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford: teaches graduate students in clinical psychology at Palo Alto University.  In July, she passed a polygraph test administered by the FBI.      Married with young children, Dr. Ford has been viciously harassed, her computer hacked, her life threatened, and forced to  move her family out of her home as result of coming forward. She insists the FBI conduct a an investigation into the matter before she comes forward
however, her allegation is not a federal crime, so the only way the FBI can get involved is if Trump requests it – Ha !
        A classmate posted to social media that she remembers chatter about the incident at school shortly after it happened.
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullified by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (Washington Post). …………………………………………………………………   
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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Trump boasts about the stock market in his first 31 months as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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The U.S. Chamber of Commerce currently 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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then too, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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 outcome in North Carolina Pennsylvania, and Wisconsin.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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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        Treason is defined by Article 3, section 3: Treason, as 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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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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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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller,   assuming Trump first fired Rosenstein.
     On November 8, I noted Brian Benczkowski 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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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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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 ?) …………………………………………….
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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Street Ignoring Warning Signs

 

Street Ignoring Warning Signs

INVESTORS first read.com – Daily edge before the open       
DJIA:  26,743
S&P 500: 2,929
Nasdaq Comp.:7,986
Russell 2000: 1,712
Monday, September 24,  2018   9:17 a.m
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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
 “Stocks at Records-Dow beats all-time high of January”
– Market Watch – September 20, 2018.     
      
The market will open on the soft side today, as uncertainty about the success of Brett Kavanaugh’s confirmation to the U.S. Supreme Court rises amid new allegations of  sexual misconduct.
          Then too, there is rising concern of a “Friday Night Massacure II,” as Trump seeks to rearrange the Department of Justice  so it is more accommodative to his whims.  The end game here is to find a way to impede progress or stop to the Special Counsel’s investigation  into his administration and Trump himself.
      So far, the Street could care less, which suggests the decision makers haven’t programmed their algorithms to respect what a sudden plunge in confidence in the future  can do to stock prices. My guess is  90% of the Street’s decision makers were not around for Watergate, which was chump change compared with what we are dealing with today.
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       No one wants to look at the warning signs, not while money is so easily made with the promise of more to come.  The warning signs are all there (see below “Bearish,”),  but it is now a question of how much more overpriced can stocks get ?
        I thought stocks were overvalued a long time ago – and they were, but speculative fever is hard to measure when it  is out of control.
        A change in direction can be caused by an event, or a change in the buy sell  ratio, BIG money cutting back on buying and actually taking profits.
        Odds favor a spike up will be followed by a sharp correction of 5% -10% followed by a rally that looks like another leg to new highs.
          That is the killer rally, because it sucks in all those who still have cash in reserve.  The next leg down  takes the market down 12% – 18% from the all-time highs.  At that point, further downside depends on what new news hits the market.  That is when a correction becomes a bear market.
          Yes, the market can go higher. Is new buying worth the risk ?  Why not a nice cash position (30% -40%) just in case  the majority of investors are wrong, too blinded by “fever” to see the risk ?  At extremes, CASH is an investment.
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NOTE:
>The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
>Bear markets start 6 – 12 months ahead of the onset of a recession        

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SUPPORT “today”:DJIA26,686 S&P 500:2,925;Nasdaq Comp.:7,961
RESISTANCE: “today” DJIA:26,783; S&P:2,932; Nasdaq Comp.:7,998
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HIGHLIGHTS – Stock Market/Economy
       The Federal Open Market Committee (FOMC)  has a policy announcement 2:00 p.m., Wednesday followed by a press conference at 2:30 with Fed Chair Jerome Powell. The Fed is expected to bump its benchmark federal funds rate up a quarter point, currently at 2.00%.
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       Of particular importance this week are: FHFA House Price Index (Tues. 9:00 a.m.), New Home Sales (Wed. 10:00 a.m.)Pending Home Sales  (Thur. 10:00 a.m.).  Housing is one of our economy’s biggest drags.
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       Tax Reform 2.0
  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people and reduce federal government receipts by up to $3 trillion in the future.
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      The Trump administration will levy 10% tariffs on approximately $200        billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
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David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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HIGHLIGHTS – POLITICAL

Kavanaugh’s prospects dimming
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      The number of  Supreme Court Justices is not fixed at nine by Article III of the U.S. Constitution.    Reportedly, a majority  vote by both Houses can change the number of Justices on the Supreme Court. ……………………………………………………………….
      Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.   Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.
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Remember the name of Brian Benszkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%.
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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.  . 
      >The 10-year treasury has been rising steadily and now stands at 3.09%.
      > The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
 OVERVALUED MARKET
      > 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.
       > If companies are buying back their own stock at a record clip, pushing stocks higher, why then are insiders selling $8 of stock for every $1 of stock they buy ?
       .> Companies 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.
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       > The S&P 500 price to sales ratio at 2.30 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%.
       > The Shiller P/E is 33.5  times earnings versus a mean of 16.6.  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.”
        > 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.
AGING BULL MARKET:
       > The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      > Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      > The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      > 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. 
      > Housing stocks have been in a prolonged slump since January. The iShares  home construction ETF has dropped 20.5%, 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.
      > 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      > Recently, 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.              
TRUMP’S TRADE WAR TANTRUM
      > Trump’s tariff tiff costing  US companies a bundle:  The damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
      > 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.
      >  Trump is considering leaving World Trade Organization (WTO).
TRUMP ADMINISTRATION IMPLODING:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
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POLITICAL/STOCK MARKET

Kavanaugh is burnt toast !

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including a Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford: teaches graduate students in clinical psychology at Palo Alto University.  In July, she passed a polygraph test administered by the FBI.      Married with young children, Dr. Ford has been viciously harassed, her computer hacked, her life threatened, and forced to  move her family out of her home as result of coming forward. She insists the FBI conduct a an investigation into the matter before she comes forward
however, her allegation is not a federal crime, so the only way the FBI can get involved is if Trump requests it – Ha !
        A classmate posted to social media that she remembers chatter about the incident at school shortly after it happened.
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullified by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (Washington Post). …………………………………………………………………   
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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Trump boasts about the stock market in his first 31 months as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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The U.S. Chamber of Commerce currently 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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then too, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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 outcome in North Carolina Pennsylvania, and Wisconsin.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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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        Treason is defined by Article 3, section 3: Treason, as 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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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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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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller,   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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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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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 ?) …………………………………………….
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.

 

 

A

 

 

 

 

 

 

 

 

 

 

 

 

Sheer Panic ! Raise Cash to 50%

INVESTORS  first read.com – Daily edge before the open       
DJIA:  26,656
S&P 500: 2,930
Nasdaq Comp.:8,028
Russell 2000: 1,720

Friday, September 21,  2018   9:17 a.m.

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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
 “Stocks at Records-Dow beats all-time high of January”
– Market Watch – September 20, 2018.  
    
The DJIA was the last of the four major market averages to hit an all-time high this year.
      It surely looks like any stock an investor buys will  be a winner. How can a person miss ?  How can anyone be sitting on cash when others are making money ?
      That’s what late-stage bull markets look like –irresistible !
      Those who remember what the bull market top looked like in 2007 and  January 2000, will get a feeling on déjà vu.

      And the market can keep  going up if investors panic and jump in, worse yet, borrow to buy stock, leveraging what they think is a sure thing.  This happens to every market prior to a major correction or a bear market.
        No one wants to look at the warning signs,
not while money is so easily made with the promise of more to come.  The warning signs are all there (see below “Bearish,”),  but it is now a question of how much more overpriced can stocks get ?
         I thought stocks were overvalued a long time ago – and they were, but speculative fever is hard to measure when it  is out of control.
        A change in direction can be caused by an event, or a change in the buy sell  ratio, BIG money cutting back on buying and actually taking profits.
         Odds favor a spike up will be followed by a sharp correction of 5% -10% followed by a rally that looks like another leg to new highs.
          That is the killer rally, because it sucks in all those who still have cash in reserve.  The next leg down  takes the market down 12% – 18% from the all-time highs.  At that point, further downside depends on what new news hits the market.  That is when a correction becomes a bear market.
          Yes, the market can go higher. Is new buying worth the risk ?  Why not a nice cash position (30% -40%) just in case  the majority of investors are wrong, too blinded by “fever” to see the risk ?  At extremes, CASH is an investment.
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NOTE:
>The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
>Bear markets start 6 – 12 months ahead of the onset of a recession         

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SUPPORT “today”:DJIA:26,521; S&P 500:2,923;Nasdaq Comp.:8,016
RESISTANCE: “today” DJIA:26,676; S&P:2,941; Nasdaq Comp.:8,051
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HIGHLIGHTS – Stock Market/Economy
      Tax Reform 2.0  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people and reduce federal government receipts by up to $3 trillion in the future.
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      The Trump administration will levy 10% tariffs on approximately $200        billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
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David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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HIGHLIGHTS – POLITICAL

      The number of  Supreme Court Justices is not fixed at nine by Article III of the U.S. Constitution.    Reportedly, a majority  vote by both Houses can change the number of Justices on the Supreme Court. ……………………………………………………………….
      Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.   Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.
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Remember the name of Brian Benszkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%.
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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.  . 
      >The 10-year treasury has been rising steadily and now stands at 3.09%.
      > The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
 OVERVALUED MARKET
      > 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.
       > If companies are buying back their own stock at a record clip, pushing stocks higher, why then are insiders selling $8 of stock for every $1 of stock they buy ?
       .> Companies 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.
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       > The S&P 500 price to sales ratio at 2.30 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%.
       > The Shiller P/E is 33.3  times earnings versus a mean of 16.6.  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.”
        > 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.
AGING BULL MARKET:
       > The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      > Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      > The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      > 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. 
      > 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.
      > 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      > Recently, 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.              
TRUMP’S TRADE WAR TANTRUM
      > Trump’s tariff tiff costing  US companies a bundle:  The damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
      > 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.
      >  Trump is considering leaving World Trade Organization (WTO).
TRUMP ADMINISTRATION IMPLODING:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
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POLITICAL/STOCK MARKET

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including a Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford: teaches graduate students in clinical psychology at Palo Alto University.  In July, she passed a polygraph test administered by the FBI.      Married with young children, Dr. Ford has been viciously harassed, her computer hacked, her life threatened, and forced to  move her family out of her home as result of coming forward. She insists the FBI conduct a an investigation into the matter before she comes forward
however, her allegation is not a federal crime, so the only way the FBI can get involved is if Trump requests it – Ha !
        A classmate posted to social media that she remembers chatter about the incident at school shortly after it happened.
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullified by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (Washington Post). …………………………………………………………………   
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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Trump boasts about the stock market in his first 31 months as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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The U.S. Chamber of Commerce currently 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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then too, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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 outcome in North Carolina Pennsylvania, and Wisconsin.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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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        Treason is defined by Article 3, section 3: Treason, as 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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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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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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller,   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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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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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 ?) …………………………………………….
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.

 

 

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Late-Stage Bull Market Behavior

INVESTORS  first read.com – Daily edge before the open       
DJIA:  26,405
S&P 500: 2,947
Nasdaq Comp.:7,950
Russell 2000: 1,702

Thursday, September 20,  2018   9:17 a.m.

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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
     Speculative Fever escalates even in face of rising interest rates.  It will not stop until a major institution breaks ranks and begins to sell aggressively.  That could be today or weeks from now.  This is a runaway train, which is classic late-stage bull market action.
      The 10-year Treasury is now at 3.09, a reminder that interest rates rising.  So far, the market could care less.
      Again, I emphasize that so many of the  decisions made on Wall Street are computer-based, that  the market action we have seen for years suggests most of those computer decisions (algorithms) are programmed to buy at the market and on dips.
      Any decision to reduce buying or to sell by a few of these institutions will trigger the same response by all institutions, resulting in a steep plunge, but         until some one breaks ranks, expect the market averages to keep notching up.
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>The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
>Bear markets start 6 – 12 months ahead of the onset of a recession         

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SUPPORT “today”:DJIA:26,376; S&P 500:2,904;Nasdaq Comp.:7,963
RESISTANCE: “today” DJIA:26,537; S&P:2,921; Nasdaq Comp.:7,985
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HIGHLIGHTS – Stock Market/Economy
      Tax Reform 2.0  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people and reduce federal government receipts by up tp $3 trillion in the future.
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      The Trump administration will levy 10% tariffs on approximately $200        billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
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David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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HIGHLIGHTS – POLITICAL

      The number of  Supreme Court Justices is not fixed at nine by Article III of the U.S. Constitution at  nine.    A majority  vote by both Houses can change the number of Justices on the Supreme Court. ……………………………………………………………….
      Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.   Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.
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Remember the name of Brian Benszkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%.
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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.  . 
      >The 10-year treasury has been rising steadily and now stands at 3.09%.
      > The yield curve is flattening as short-term treasuries rise faster than long-tern governments just another warning sign of impending recession.
 OVERVALUED MARKET
      > 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.
       > If companies are buying back their own stock at a record clip, pushing stocks higher, why then are insiders selling $8 of stock for every $1 of stock they buy ?
       .> Companies 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.
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       > The S&P 500 price to sales ratio at 2.30 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%.
       > The Shiller P/E is 33.3  times earnings versus a mean of 16.6.  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.”
        > 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.
AGING BULL MARKET:
       > The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      > Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      > The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
      > 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. 
      > 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.
      > 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      > Recently, 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.              
TRUMP’S TRADE WAR TANTRUM
      > Trump’s tariff tiff costing  US companies a bundle:  The damage extends to manufacturers, input suppliers, fishermen, and numerous businesses who are finding it more difficult to sell abroad.
      > 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.
      >  Trump is considering leaving World Trade Organization (WTO).
TRUMP ADMINISTRATION IMPLODING:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
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POLITICAL/STOCK MARKET

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including: teaching graduate students in clinical psychology at Palo Alto University; a undergraduate degree at University of North Carolina, a Master’s  Degree in psychology at Pepperdine Univ. and Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford Univ.; has co-authored 50+ scientific publications; passed a polygraph test administered by the FBI in July, all reported by the Washington Post.
      Married with young children, Dr. Ford has now indicated she is reluctant to come forward unless the FBI first conducts an investigation. She has been viciously harassed, her computer hacked, her life threatened  hammered, and forced to  move her family out of her home.
        However, her allegation is not a federal crime, so the only way the FBI can get involved is if Trump requests it.
        A classmate posted to social media that she remembers chatter about the incident at school shortly after it happened.
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullifies by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (Washington Post). …………………………………………………………………   
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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Trump boasts about the stock market in his first 31 months as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then too, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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 outcome in North Carolina Pennsylvania, and Wisconsin.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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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        Treason is defined by Article 3, section 3: Treason, as 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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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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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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needs 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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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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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 ?) …………………………………………….
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.

 

 

 

 

 

 

 

 

 

 

 

 

 

10-Year Treasury at 3.05%

INVESTORS  first read.com – Daily edge before the open
DJIA:  26246
S&P 500: 2,904
Nasdaq Comp.:7,956
Russell 2000: 1,710

Wednesday, September 19,  2018   9:17 a.m.

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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
        This is what speculative fever looks like in a late-stage bull market. 
        We are reaching the “I can’t stand it anymore” point where investors go “all-In” and  load up thinking they will sell at higher prices to someone else. It is also called the “greater fool theory” where one fool buys expecting to sell to a greater fool at a higher price.
        It’s human nature – greed at tops, fear at bottoms.
        Yesterday, the market jumped on news of a ramped up trade war with China which should have been bad news. 
         When the initial reaction as reflected in pre-open futures trading was not negative, the Street interpreted that as a “buy,” and  stepped in running stocks up across the board.
          At some point, higher prices in a market that has been historically overvalued for a year will attract sellers who want to get ahead of others and take  profits before the market breaks.

  The Trump administration will levy 10% tariffs on approximately $200 billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China will retaliate with duties on $60 billion worth of U.S. exports, pretty much ensuring Trump will go ahead with the next round of tariffs.
       According to POLITICO all  this will result in Trump levies on $253 billion of Chinese exports, close to half  of all the $506 billion shipped to the U.S. last year, and China having placed levies on %113 billion of imports from the U.S., which totaled $130 billion last year.
             The 10-year Treasury topped 3.0% this morning, a reminder that interest rates were rising.  So far, the market could care less.

       For weeks, I have warned that auto sales and housing are the two key sectors of the economy that signal trouble ahead.  Look for confirmation for housing  this week: Housing Market Index (today: 10:00 a.m.), Housing Starts (Wed. 8:30 a.m.), Existing Home Sales (Thurs. 10:00 a.m).
        Again, I emphasize that so many of the  decisions made on Wall Street are computer-based, that  the market action we have seen for years suggests most of those computer decisions (algorithms) are programmed to buy at the market and on dips.
         Any decision to reduce buying or to sell by a few of these institutions will trigger the same response by all institutions, resulting in a steep plunge, so steep and abrupt no one will be able to respond before a lot of damage has been done.  This is the new normal for our stock market.  The days of gradual corrections of more than 10% are over.
        Until some one breaks ranks, expect the market averages to keep notching up.
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       The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
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       Tax Reform 2.0  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people, and of course,  is intended to please voters going into the midterm elections.
     The Joint Committee on Taxation (JCT), Congress’ tax scorekeeper estimates the bill would reduce federal government receipts by $631, though other sources put the number at $3 trillion, adding the biggest beneficiaries would be those with family income between $357,00 to $836,ooo.

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SUPPORT “today”:DJIA:26,201 ; S&P 500:2,899;Nasdaq Comp.:7,941
RESISTANCE: “today” DJIA:26,267; S&P:2,910; Nasdaq Comp.:7,941
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HIGHLIGHTS – Stock Market/Economy
(David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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Based on what we read and hear, the stock market and economy just couldn’t get better.  This is good time to look for reasons they won’t.
     Just about all the economic numbers are strong –employment,  manufacturing, service, wages, corporate earnings, two key areas are sucking wind – motor vehicle sales
(flat most of the year). with the trend  expected to continue, and Housing, which is  hurting what with rising mortgage rates, low inventory and  high home prices, driven in part due to higher construction costs. Lumber prices have been pushed higher by tariffs on Canada, as well as a shortage of labor
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      With the economy humming on eight cylinders, investors must remember, a bear market starts 6 – 12 months ahead of the onset of a recession.       
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HIGHLIGHTS – POLITICAL 

[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials (see below “Political/Stock Market”). 
BUT, due to being subjected to vicious harassment, her computer hacked, receiving death threats and being forced to move her family out of their home, she may not testify before the Senate Judiciary Committee.  That is the FASCIST STATE, TRUMP HAS ENABLED, which may please AINO, but is cause for outright fear among real Americans.
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Paul Manaforth has tentatively agreed to a plea deal with Special Counsel Robert Mueller, details pending.
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The number of  Supreme Court Justices is not fixed at  nine.
While conservative Supreme Court nominee Bret Kavanaugh’s approval works its way through Congressional approval, it is worth noting that a majority  vote by both Houses can change the number of Justices on the Supreme Court. The number is NOT fixed by statute, not by the US Constitution.  Perhaps the Republicans will attempt to stack the court just in case the Democrats gain control of both Houses at some point in the future and beat them to the punch.
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       Reportedly, Bob Woodward’s new book, “Fear” portrays a dysfunctional White House and a weak president who is unpredictable, distrustful, and unable to grasp policy.
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     Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.
      Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.  Cutting ties to the federal government in favor of greater control by states could backfire on Republicans. Six “red” states (Kentucky, Indiana, Arkansas, , Maine, Utah and Wisconsin are most in need of federal assistance.
      Stop calling these people conservatives. They are extremists, constitutional anarchists. The Republican Party has no time for Conservatives as we once knew them.
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Remember the name of Brian Benszkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller, based on the assumption someone who was confirmed by the Senate would have to be brought in from the outside to do the job.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%
      With market over valuation running at extremes, these sharp increases in earnings are already built into the market.
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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
      It’s been 10 years since the bear market that accompanied the Great Recession  of 2007-2009. Memories are short. I doubt that a good number of Wall Street decision makers were NOT in the business then.
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      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.
      Companies are buying back their own stock at a record clip, pushing stocks higher
      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.
      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.
      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.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in According to a recent  SEC study, 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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       The S&P 500 price to sales ratio at 2.30 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 33.3  times earnings versus a mean of 16.6.  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.”
        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.
AGING BULL MARKET:
      The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
     “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.
      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. 
      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.
      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.
      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 years ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      The Fed’s 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       Recently, 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.              
      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.
TRUMP’S TRADE WAR TANTRUM:

A “preliminary agreement in principle” with Mexico to revise certain issues in Nafta has been reached, but Canada has not followed suit.  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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Trump’s tariff tiff costing  US companies a bundle:
         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.
       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 is considering leaving World Trade Organization (WTO).
      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:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
      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 MARKE

[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including: teaching graduate students in clinical psychology at Palo Alto University in consortium with Stanford University; getting her undergraduate degree at  the University of North Carolina, Master’s  Degree in psychology at Pepperdine Univ. Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford Univ.; has co-authored 50+ scientific publications; passed a polygraph test administered by the FBI in July, all reported by the Washington Post.
      Married with young children, Dr. Ford has now indicated she is reluctant to come forward unless the FBI first conducts an investigation. She has been viciously harassed, her computer hacked, her life threatened  hammered, and forced to  move her family out of her home.
      The Senate Judiciary Committee will move ahead with a vote with her or without her.
      What does this mean for Kavanaugh, who has said “ I categorically and unequivocally deny this allegation ?”
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullifies by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
       Brian who ?     See below under Highlights – Political.
What’s my point ?  There is the potential for political fireworks as Trump pulls his own version of a “Friday Night Massacre” when Nixon ordered his Atty Gen. Elliott Richardson to fire special prosecutor  Archibald Cox.
       If this happens, the future of the Trump administration is in question, creating uncertainty Wall Street can’t ignore with stock valuations in the stratosphere.
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Is the right wing throwing Trump under the bus ?  He is jeopardizing everything they have worked for. Democrat control of the House, possibly the Senate, threatens to jettison their stealthy takeover of our republic and replace it with a quasi totalitarian state.
AUTHOR OF NYT OP-ED could be a right winger concerned more for the survival of  the conservative wing of the Republican party than for what’s best to America.
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (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 ?. 
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Trump boasts about the stock market in his first 31 days as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then two, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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 ?    ……………………………………………….
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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needs 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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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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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 ?) …………………………………………….
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.

 

 

 

 

 

 

 

 

 

 

 

War on Two Fronts

INVESTORS  first read.com – Daily edge before the open
DJIA:  26,068
S&P 500: 2,880
Nasdaq Comp.:7,895
Russell 2000: 1,703

Tuesday, September 18,  2018   8:58 a.m.

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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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
      The Trump administration will levy 10% tariffs on approximately $200 billion of Chinese imports starting  Monday, September 24 then increase the tariff to 25% by year-end. Additionally, the US will launch  a third round of tariffs on  $267 billion of Chinese imports if China retaliates. 
      China is expected to announce its retaliation  next week.
      The market  is up in futures trading in response to Trump’s announcement, possibly because the action was priced in the averages, and possibly because  the Street is getting a little too blasé about the potential impact on confidence and on  the complexity this trade war has created for making  corporate decisions – supply chains, etc.
       The 10-year Treasury topped 3.0% this morning, a reminder that interest rates were rising.  So far, the market could care less.

       For weeks, I have warned that auto sales and housing are the two key sectors of the economy that signal trouble ahead.  Look for confirmation for housing  this week: Housing Market Index (today: 10:00 a.m.), Housing Starts (Wed. 8:30 a.m.), Existing Home Sales (Thurs. 10:00 a.m).
        Again, I emphasize that so many of the  decisions made on Wall Street are computer-based, that  the market action we have seen for years suggests most of those computer decisions (algorithms) are programmed to buy at the market and on dips.
         Any decision to reduce buying or to sell by a few of these institutions will trigger the same response by all institutions, resulting in a steep plunge, so steep and abrupt no one will be able to respond before a lot of damage has been done.  This is the new normal for our stock market.  The days of gradual corrections of more than 10% are over.
        Until some one breaks ranks, expect the market averages to keep notching up.
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       The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
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       Tax Reform 2.0  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people, and of course,  is intended to please voters going into the midterm elections.
     The Joint Committee on Taxation (JCT), Congress’ tax scorekeeper estimates the bill would reduce federal government receipts by $631, though other sources put the number at $3 trillion, adding the biggest beneficiaries would be those with family income between $357,00 to $836,ooo.

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SUPPORT “today”:DJIA:25,542 ; S&P 500:2,861;Nasdaq Comp.:7,817
RESISTANCE: “today” DJIA:26,177; S&P:2,892; Nasdaq Comp.:7,911
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HIGHLIGHTS – Stock Market/Economy
(David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks to 25%.
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Based on what we read and hear, the stock market and economy just couldn’t get better.  This is good time to look for reasons they won’t.
     Just about all the economic numbers are strong –employment,  manufacturing, service, wages, corporate earnings, two key areas are sucking wind – motor vehicle sales
(flat most of the year). with the trend  expected to continue, and Housing, which is  hurting what with rising mortgage rates, low inventory and  high home prices, driven in part due to higher construction costs. Lumber prices have been pushed higher by tariffs on Canada, as well as a shortage of labor
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      With the economy humming on eight cylinders, investors must remember, a bear market starts 6 – 12 months ahead of the onset of a recession.       
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HIGHLIGHTS – POLITICAL 

[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials (see below “Political/Stock Market”).
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Paul Manaforth has tentatively agreed to a plea deal with Special Counsel Robert Mueller, details pending.
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The number of  Supreme Court Justices is not fixed at  nine.
While conservative Supreme Court nominee Bret Kavanaugh’s approval works its way through Congressional approval, it is worth noting that a majority  vote by both Houses can change the number of Justices on the Supreme Court. The number is NOT fixed by statute, not by the US Constitution.  Perhaps the Republicans will attempt to stack the court just in case the Democrats gain control of both Houses at some point in the future and beat them to the punch.
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       Reportedly, Bob Woodward’s new book, “Fear” portrays a dysfunctional White House and a weak president who is unpredictable, distrustful, and unable to grasp policy.
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     Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.
      Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.  Cutting ties to the federal government in favor of greater control by states could backfire on Republicans. Six “red” states (Kentucky, Indiana, Arkansas, , Maine, Utah and Wisconsin are most in need of federal assistance.
      Stop calling these people conservatives. They are extremists, constitutional anarchists. The Republican Party has no time for Conservatives as we once knew them.
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Remember the name of Brian Benszkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller, based on the assumption someone who was confirmed by the Senate would have to be brought in from the outside to do the job.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%
      With market over valuation running at extremes, these sharp increases in earnings are already built into the market.
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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
      It’s been 10 years since the bear market that accompanied the Great Recession  of 2007-2009. Memories are short. I doubt that a good number of Wall Street decision makers were NOT in the business then.
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      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.
      Companies are buying back their own stock at a record clip, pushing stocks higher
      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.
      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.
      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.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in According to a recent  SEC study, 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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       The S&P 500 price to sales ratio at 2.30 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 33.3  times earnings versus a mean of 16.6.  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.”
        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.
AGING BULL MARKET:
      The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
     “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.
      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. 
      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.
      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.
      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 years ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      The Fed’s 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       Recently, 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.              
      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.
TRUMP’S TRADE WAR TANTRUM:

A “preliminary agreement in principle” with Mexico to revise certain issues in Nafta has been reached, but Canada has not followed suit.  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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Trump’s tariff tiff costing  US companies a bundle:
         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.
       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 is considering leaving World Trade Organization (WTO).
      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:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
      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
[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including: teaching graduate students in clinical psychology at Palo Alto University in consortium with Stanford University; getting her undergraduate degree at  the University of North Carolina, Master’s  Degree in psychology at Pepperdine Univ. Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford Univ.; has co-authored 50+ scientific publications; passed a polygraph test administered by the FBI in July, all reported by the Washington Post.
      Married with young children, Dr. Ford was reluctant to come forward knowing there would be a retaliation by Republicans.
      What does this mean for Kavanaugh, who has said “ I categorically and unequivocally deny this allegation ?”
       The Judiciary Committee has agreed to hold public hearings for both starting at 10:00 a.m. Monday Sept. 24.      

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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullifies by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
       Brian who ?     See below under Highlights – Political.
What’s my point ?  There is the potential for political fireworks as Trump pulls his own version of a “Friday Night Massacre” when Nixon ordered his Atty Gen. Elliott Richardson to fire special prosecutor  Archibald Cox.
       If this happens, the future of the Trump administration is in question, creating uncertainty Wall Street can’t ignore with stock valuations in the stratosphere.
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Is the right wing throwing Trump under the bus ?  He is jeopardizing everything they have worked for. Democrat control of the House, possibly the Senate, threatens to jettison their stealthy takeover of our republic and replace it with a quasi totalitarian state.
AUTHOR OF NYT OP-ED could be a right winger concerned more for the survival of  the conservative wing of the Republican party than for what’s best to America.
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (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 ?. 
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Trump boasts about the stock market in his first 31 days as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then two, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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 ?    ……………………………………………….
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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needs 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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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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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 ?) …………………………………………….
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.

 

 

 

 

 

 

 

 

 

 

Key Housing Data Due This Week

INVESTORS  first read.com Daily edge before the open
DJIA:  26,154
S&P 500: 2,904
Nasdaq Comp.:8,010
Russell 2000: 1,717

Monday, September 17,
 2018    9:07 a.m.
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NOTE: HURRICANE FLORENCE MAY CAUSE POWER OUTAGES AND AN INTERRUPTION IN MY INTERNET CONNECTION FOR DAYS OR LONGER

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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 abou t 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.
Damn it ! I miss decency
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Market Status: Late stage BULL, with high risk of sudden severe correction.
Institutional computer algorithms heavily skewed to “buy.” Any change to “sell” would have dramatic negative impact, and we are getting close to that day.
 Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Bull markets

 Market Today:
       The market will begin the day on the downside. For weeks, I have warned that auto sales and housing are the two key sectors of the economy that signal trouble ahead.  Look for confirmation for housing  this week: Housing Market Index (Tues. 10:00 a.m.), Housing Starts (Wed. 8:30 a.m.), Existing Home Sales (Thurs. 10:00 a.m).
        Again, I emphasize that so many of the  decisions made on Wall Street are computer-based, that  the market action we have seen for years suggests most of those computer decisions (algorithms) are programmed to buy at the market and on dips.
         Any decision to reduce buying or to sell by a few of these institutions will trigger the same response by all institutions, resulting in a steep plunge, so steep and abrupt no one will be able to respond before a lot of damage has been done.  This is the new normal for our stock market.  The days of gradual corrections of more than 10% are over.
        Until some one breaks ranks, expect the market averages to keep notching up.

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       The average length of 15 bull markets going back to 1957-1960 is 30.4 months.  Through September, this bull market is 114 months old, or 3.75 times longer than the average.
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       Tax Reform 2.0  passed committee on a party-line vote  crafted to reduce individual tax rates, increase the standard deduction for income from non-corporate businesses, as well as the cap on state and local deduction (SALT), currently $10,000. As expected the bill gives most of the benefits to upper income people, and of course,  is intended to please voters going into the midterm elections.
     The Joint Committee on Taxation (JCT), Congress’ tax scorekeeper estimates the bill would reduce federal government receipts by $631, though other sources put the number at $3 trillion, adding the biggest beneficiaries would be those with family income between $357,00 to $836,ooo.

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SUPPORT “today”:DJIA: 26.077; S&P 500:2,901;Nasdaq Comp.:7,989
RESISTANCE: “today” DJIA:26,181; S&P:2,908; Nasdaq Comp.:8,014
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HIGHLIGHTS – Stock Market/Economy
     David Tepper, head of $14 billion Appaloosa Management told CNBC he has reduced his funds exposure to stocks th 25%.

Based on what we read and hear, the stock market and economy just couldn’t get better.  This is good time to look for reasons they won’t.
     Just about all the economic numbers are strong –employment,  manufacturing, service, wages, corporate earnings, two key areas are sucking wind – motor vehicle sales
(flat most of the year). with the trend  expected to continue, and Housing, which is  hurting what with rising mortgage rates, low inventory and  high home prices, driven in part due to higher construction costs. Lumber prices have been pushed higher by tariffs on Canada, as well as a shortage of labor
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      With the economy humming on eight cylinders, investors must remember, a bear market starts 6 – 12 months ahead of the onset of a recession.       
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HIGHLIGHTS – POLITICAL 

[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials (see below “Political/Stock Market”).
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Paul Manaforth has tentatively agreed to a plea deal with Special Counsel Robert Mueller, details pending.
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The number of  Supreme Court Justices is not fixed at  nine.
While conservative Supreme Court nominee Bret Kavanaugh’s approval works its way through Congressional approval, it is worth noting that a majority  vote by both Houses can change the number of Justices on the Supreme Court. The number is NOT fixed by statute, not by the US Constitution.  Perhaps the Republicans will attempt to stack the court just in case the Democrats gain control of both Houses at some point in the future and beat them to the punch.
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       Reportedly, Bob Woodward’s new book, “Fear” portrays a dysfunctional White House and a weak president who is unpredictable, distrustful, and unable to grasp policy.
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     Breaking: Concern that right wingers are set to rewrite the United States Constitution via an Article V Convention, or Amendments Convention, called by two-thirds of the state legislatures (34).  A three-quarter vote is required for an amendment to become part of the Constitution.
      Reportedly, right wingers want to convert our system of government to a confederation of “supreme” states, essentially minimizing the present amount of federal control.  Cutting ties to the federal government in favor of greater control by states could backfire on Republicans. Six “red” states (Kentucky, Indiana, Arkansas, , Maine, Utah and Wisconsin are most in need of federal assistance.
      Stop calling these people conservatives. They are extremists, constitutional anarchists. The Republican Party has no time for Conservatives as we once knew them.
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Remember the name of Brian Benszkowski. Rachel Maddow mentioned him in connection with Supreme Court nominee, Bret Kavenaugh. He heads up the criminal division for the DOJ. I wrote about him on November 8, 2017 as a wild card replacement for Sessions, but also as a possible DOJ attorney who would fire Mueller, based on the assumption someone who was confirmed by the Senate would have to be brought in from the outside to do the job.
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BULLISH CASE
      A sharp increase in corporate earnings is what the bulls are relying on to power the market higher.
      Q2 earnings increased 25.0% over a year ago.
      Thomson Reuters projects Q3’s increase in earnings to  hit 20.5% and Q4 18.0%.
      However 2019 is a different story with earnings increases of Q1: +5.0%, Q2: +7.2%, Q3: +9.3% and Q4: +8.9%, that averages out to +7.6%
      With market over valuation running at extremes, these sharp increases in earnings are already built into the market.
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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
      It’s been 10 years since the bear market that accompanied the Great Recession  of 2007-2009. Memories are short. I doubt that a good number of Wall Street decision makers were NOT in the business then.
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      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.
      Companies are buying back their own stock at a record clip, pushing stocks higher
      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.
      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.
      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.
      “Insider selling accelerates immediately after buybacks are unveiled,” notes SEC’s, Robert Jackson, adding its study in According to a recent  SEC study, 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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       The S&P 500 price to sales ratio at 2.30 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 33.3  times earnings versus a mean of 16.6.  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.”
        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.
AGING BULL MARKET:
      The bull market is now  nine years and six months old (115 months).  That’s 3.5 times the average of the last 15 bull markets.
AGING ECONOMIC EXPANSION:
      Republicans – the recession party. Nine of last 10 recession have been with a Republican in the White House.  Odds favor Trump will make 10 for 11.
      The current economic expansion has lasted 111 months. That’s 52 months (1.9 x) longer than the average expansion going back to 1945.  Nine out of the last 10 recessions have occurred with a Republican in the White House.
     “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.
      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.  
      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.
      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.
      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 years ago instead of buying back stock. While wages should be increasing under these conditions, they haven’t so far.
      The Fed’s 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, refinancing will get more costly, according to S&P analyst, Andrew Chang, who points out that this amounts to $8 for every $1 in cash.
      Manufacturing was weak in August with both the Kansas City Fed index and Philly manufacturing indexes dropping sharply.
       Recently, 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.              
      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.
TRUMP’S TRADE WAR TANTRUM:

A “preliminary agreement in principle” with Mexico to revise certain issues in Nafta has been reached, but Canada has not followed suit.  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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Trump’s tariff tiff costing  US companies a bundle:
         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.
       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 is considering leaving World Trade Organization (WTO).
      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:
      So far, the stock market has not wavered in face of the increasing likelihood, Trump and many present and former associates are in legal trouble.
      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
[NEW] Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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[NEW] Supreme Court Nominee, Brett Kavanaugh’s sexual misconduct accuser, Dr. Christine Blasey Ford, has come forward, and she has impressive credentials, including: teaching graduate students in clinical psychology at Palo Alto University in consortium with Stanford University; getting her undergraduate degree at  the University of North Carolina, Master’s  Degree in psychology at Pepperdine Univ. Ph.D in Educational Psychology at Univ. Southern California and Master’s in Education from Stanford Univ.; has co-authored 50+ scientific publications; passed a polygraph test administered by the FBI in July, all reported by the Washington Post.
      Married with young children, Dr. Ford was reluctant to come forward knowing there would be a retaliation by Republicans.
      What does this mean for Kavanaugh, who has said “ I categorically and unequivocally deny this allegation ?”
       We will have to wait and see.  The Republican-controlled Senate Judicial Committee has been ramrodding his nomination through  Committee even though access to thousands of pages of  background material on Kavanaugh have been denied Democrat review prior to a vote.  At press time Judiciary Committee Republican Senators Collins, Murkowski, and Flake are considering delaying the vote, however, Senate Majority Leader Mitch McConnel may bypass a vote by the Judiciary Committee (11 Reps., 10 Dems) and go to the Senate floor for a vote, but does that make sense where the Reps. have a one-vote advantage ?
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  As if Trump did not have enough problems, here comes Allen Weisselberg, long-time CFO of the Trump Organization and now a recipient of “immunity” from  the Attorney General of New York.
       This is especially significant, notes PalmerReports.com, since he is testifying about state level charges in addition to federal charges, which cannot be nullifies by a Trump pardon.
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      NO ATTORNEY CLIENT PRIVILEGE: Palmerreport.com reminds readers that Trump has NO attorney-Client privilege with Ty Cobb who he hired on July 14, 2017 to help with the Russia scandal. To save personal funds, Trump put Cobb on the White House payroll, so Cobb is free to disclose any information Special Counsel Mueller wants him to.
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  I expect Attorney General Sessions to be fired or to resign any day now.  That puts Deputy Atty. Gen. Rod Rosenstein in jeopardy.  Will Brian Benszkowski be moved in the fill the void. Would he fire Mueller if Rosenstein were fired ?
       Brian who ?     See below under Highlights – Political.
What’s my point ?  There is the potential for political fireworks as Trump pulls his own version of a “Friday Night Massacre” when Nixon ordered his Atty Gen. Elliott Richardson to fire special prosecutor  Archibald Cox.
       If this happens, the future of the Trump administration is in question, creating uncertainty Wall Street can’t ignore with stock valuations in the stratosphere.
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Is the right wing throwing Trump under the bus ?  He is jeopardizing everything they have worked for. Democrat control of the House, possibly the Senate, threatens to jettison their stealthy takeover of our republic and replace it with a quasi totalitarian state.
AUTHOR OF NYT OP-ED could be a right winger concerned more for the survival of  the conservative wing of the Republican party than for what’s best to America.
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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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DAMN  IT !   I miss decency.
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“President” Trump has made 4,229 false (lies) and misleading claims since his inauguration. (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 ?. 
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Trump boasts about the stock market in his first 31 days as President, but the S&P 500 appreciated 149% during President Obama’s first 31 months in office, 2 ½ times as it advanced under Trump, and Obama inherited the worst stock market/economic collapse since the 1930s, Trump inherited a strong stock market and economic recovery.

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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,  the dissemination of  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  told the 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%

The key here is twofold. The Democrats must get their vote out, which may be difficult in face of Republican voter suppression. Then two, they need to get a lot  of the Independent vote, which will be helped as Americans see the Trump administration gut treasured institutions, regulations designed to ensure a better environment in the future, healthcare, and undermine time-tested, valued global alliances while cultivating the favor of enemies.
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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 policy.
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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.
 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.
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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.
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 Sinclair Broadcast Group  (BEWARE !)   
      Sinclair Broadcast Group is using its clout as owner of  193 television stations in 80 markets 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.  A July 16, 2018 FCC decision denied Sinclair’s acquisition of the Tribune Broadcast Group, which would have expanded its reach into New York, Los Angeles, and Chicago markets
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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.
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TRUMP’S BASE:  Some voted for Trump because they always vote Republican. 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 ?    ……………………………………………….
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.
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      Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, Trump needs 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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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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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 ?) …………………………………………….
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.