Bears to Provide Bulls With Opportunity in 2019

INVESTORS first read.com – Daily edge before the open   
DJIA: 23,062
S&P 500: 2,485
Nasdaq Comp.:6,584
Russell 2000: 1,337
Monday
, December 31,  2018    9:11 a.m.
Wishing you the best in 2019
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gbifr79@gmail.com
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Sept. 21, 2018 :  Raise cash to 50% (DJIA: 26,656)
Nov. 8, 2018: Raise cash to 75% (DJIA: 26,180)
Dec. 26, 2018 Doom Thick Enough for a Rally (DJIA:  21,792)
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Market Status:
A tweet over the weekend by Trump indicating the United States and China are making progress in trade talks is  jacking stock-index futures up at the open.
But, I would expect buyers to be hitting the market anyhow. Institutions are flush with cash and stocks after a  16% plunge in the S&P 500 this month,  20% since early October, are giving institutions a chance to pick up stocks at handsome discounts.
Just how big a push we can expect in early 2019 depends on what happens to the host of uncertainties/negatives that turned stocks down in October.  Odds favor a spike in early January, then a decline into March.
In short they are: a trade war, government shutdown, looming recession, a lower growth rate for the GDP and corporate earnings, rising interest rates, aging economy, likely constitutional crisis, housing industry crunch, debt at all levels, international hotspots, global slowdown, Trump.
      Any one of these resolved successfully, can bump prices higher, but that means the market averages would be going from historically overvalued to very overvalued, this in face of sharply lower projected earnings in 2019.
HOW MUCH HIGHER FROM HERE:
Presently, without major breakthroughs on uncertainties:
DJIA: 24,417
S&P 500: 2,615
Nasdaq Comp.:6,910
The market averages must get past the following levels first;
DJIA 23,966
S&P 500: 2,570
Nasdaq Comp.: 6,850
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> PRESSTIME:
      There is a ton of cash that institutions must put to work. This buy power stands to drive the market higher into early January, where the next leg of a bear market will develop.
      So much depends on the uncertainties which are bedeviling  money managers’ and corporate decision makers’ decision process.
Presently, I see a rally running into 2019 as a “death rattle,” a fake-out that sucks a zillion investors into the market, only to betray them with another “trapdoor” effect plunge to new lows.
I think a recession has already started, as evidenced by the prolonged slump in the housing industry and industries that depend on it (appliances, furnishings, building materials and related employment).
The question now is, to what extent does a 15% decline in the S&P 500 discount  the uncertainty and impact of  a recession.
PRESSTIME:
     With the prospect of a recession looming in 2019, odds favor a turndown
from slightly higher levels in early January.
I do not think a 15% decline in the S&P 500 adequately discounts a recession, or a host of other uncertainties/negatives, as outlined below in “Bearish Case.”

     The market should start running into resistance today at:
DJIA: 23,417
S&P 500: 2,527
Nasdaq Comp.:6,706
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TRUMP
It just keeps getting worse. Yesterday a U.S. Court of Appeals for the D.C circuit ruled in favor of Special Counsel Robert Mueller’s action to subpoena an unnamed foreign entity (Russia, Saudi Arabia ?) for something that happened abroad, but directly affects the United States.
      The court procedures were so secret, an entire floor in the court house was in lockdown until a decision was rendered,
The Trump Foundation was forced to dissolve in face of a lawsuit accusing it of  “willful self-dealing” in an abuse of power  resulting in a “shocking pattern of illegality” that also includes Trump’s 2016 presidential campaign.
Special Counsel Robert Mueller is closing in on Trump, et al, and  this is going to get ugly, real ugly.
The daily disclosure of wrongdoing by this administration will weigh heavily on the market at a time the economy is going in the tank and the stock market  on the verge of a bear market.
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THE PRESIDENCY PROBLEM
      An even bigger issue is about to hit the Street right between its eyes and that is, what will happen to stock prices when President Trump is removed from office, or he resigns ?
It’s coming and it won’t be pretty,
in fact odds favor what will be released will stun everyone, even those in denial about what has been happening to our  republic.
There are other issues that can crush the market (debt, fiscal crisis, depression), but extended dysfunction in the highest office in our country has the potential for immeasurable damage to stock prices.
When it gets really  ugly, when stocks are in a tailspin, reason yields to outright fear, pounding market averages to the “I can’t stand it anymore” point where  investors just want OUT!
This is usually at or near the bear market bottom, but not before damage on the magnitude of declines like 50.5% (1998-2000) and 58% (2007-2009).
      Investors must be prepared for the possibility of this happening. If it doesn’t play out that way, be very grateful.
Nine of the last 10 recessions have occurred with a Republican in the White House,
and increasingly, it looks like  it’ll be 10 for 11.
      President Obama inherited the worst recession/bear market since the 1930s, Trump inherited a solid economic recovery, yet in the first 23 months the S&P 500 rose 54% under Obama and only 40% under Trump.
So, which party is better for the Street ?   Go figure.
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TRUMP RESIGNATION

Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
The deal would include family members.
Who would succeed Trump as President ?
       It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
What if Pence resigns first and Trump appoints another Vice President who would then become President ?
It gets complicated and divisive, and that wouldn’t be good for stock prices.
      All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
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We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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YIELD CURVE:
News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates.
The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
An inverted yield curve has preceded  9 recessions since 1955.
However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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  1. Gary Shilling just turned bearish in his November and December issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling.
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    IMPORTANT NOTES: How high is high, how long is long
    >
    Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
    >Bear markets start 6 – 12 months ahead of the onset of a recession.

    >Nine out of the last 10 recessions have occurred with a Republican in the White House
    >The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
    >Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
    > 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.
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    Bear Market Perspective

Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
Currently, my bear market target
would be declines to:
DJIA: 18,500 (-31.4%)
S&P 500 :  2,150 (-27.0%)
Nasdaq Comp.:5,200 (-36.1%)
But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
      The case for the bulls has been weakening. The stellar earnings increases in 2018 in excess of 20%  will be followed by increases less than one-third  as great .
FactSet has been lowering its projections for 2019 in recent weeks.
It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  But another rate increase in December keeps the squeeze on, and  a projected two rate hikes in 2019 instead of four is clearly no help for an economy that is showing signs of serious weakening.
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BEARISH CASE
RISING INTEREST RATES:
>The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led to an ugly slump in the housing industry.  It raised its benchmark federal funds rate in December to 2.25-2.50m percent and plans two more hikes in 2019.
>Year/year existing home sales down 8 straight months. New home sales  fell 8.9% in October.  Single family starts fell  for third straight month to an 18-month low.
>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 were 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 1.92 is 19% 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 27.5  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 17.1 times earnings and 16.8 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 (117 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 115 months. That’s 53 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.
> GDP expected to slow in 2019 to 2.7%, CAPEX to 5% from 7%.
> 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.

>Year/year existing home sales down 8 straight months. New home sales  fell 8.9% in October.  Single family starts fell  for third straight month to an 18-month low.   The 30-year fixed rate mortgage rate is projected to hit 5.3% in 2019.
The iShares  home construction ETF has dropped 30.5%, 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 Warned that  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
7,546 !!!  That’s the number of false and misleading claims made by Trump so far while in office.  Geeeeez,
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Why do Republicans deny someone else affordable healthcare ?
How sick is that ?  What is their problem ?  Want it all for themselves ?
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Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.

NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family.
hmmmmm.

How Much Higher nFor the Market ?

INVESTORS first read.com – Daily edge before the open   
DJIA: 23,138
S&P 500: 2,488
Nasdaq Comp.:6,579
Russell 2000: 1,331
Friday
, December 28,  2018    8:44 a.m.
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gbifr79@gmail.com
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Sept. 21, 2018 :  Raise cash to 50% (DJIA: 26,656)
Nov. 8, 2018: Raise cash to 75% (DJIA: 26,180)
Dec. 26, 2018 Doom Thick Enough for a Rally (DJIA:  21,792)
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Market Status:
Institutions are in panic mode. They have a bundle of client cash to invest, and the market  is running away from them.
A 16% plunge in the S&P 500 this month,  20% since early October, gave institutions a chance to pick up stocks at handsome discounts.
       Who said there isn’t a Santa ?
But an abrupt reversal the day after Christmas caught many money managers off guard, and now they are scrambling to buy targeted stocks at higher prices.
       The Grinch stole more than Christmas.
This is the punch into early January I have been referring to. Unless  some of the uncertainties, such as Trump’s unpredictability, the results of Mueller’s investigation, lower earnings, interest rates looming recession, the shutdown, and international tensions are resolved, the upside is limited.
That could mean a continuing bear market in 2019,  recession, and political turmoil.
       Q4’s out-of-character crunch is a warning that 2019 could be ugly.
Within reason, institutions must invest the money clients give them, that is what they are paid to do. That is unfortunate, because in a falling market cash is king.
And yes, the market always comes back to make new highs, but there are flaws in that thinking. Why ride out a market fully invested when you can lock in nice gains and re-invest at lower prices ?
Then too, it’s a bummer if a person is forced to sell stock after a big decline to pay big bills like college tuition or a down payment on a house.
Granted, markets eventually recover but will a senior live long enough to see it ?
Bear markets are a wrenching experience. The daily angst of falling prices can force investors to sell out at the bottom and never re-invest.
The message here is, anyone who did not raise cash at higher prices, should do so on this push upward.
HOW FAR UPWARD FROM HERE To Early January?
Presently, without major breakthroughs on uncertainties:
DJIA: 24,417
S&P 500: 2,615
Nasdaq Comp.:6,910
The market averages must get past the following levels first;
DJIA 23,966
S&P 500: 2,570
Nasdaq Comp.: 6,850
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> PRESSTIME:
      .
This rebound is driven by institutions putting a big slug of client’s cash to work at year-end.
Based on what I see now, I think this rally can carry into early 2019 where the next leg of a bear market will develop.
      So much depends on the uncertainties which are bedeviling  money managers’ and corporate decision makers’ decision process.
Presently, I see a rally running into 2019 as a “death rattle,” a fake out that sucks a zillion investors into the market, only to betray them with another “trapdoor” effect plunge to new lows.
TODAY
The market should find support today at:
DJIA: 22,392
S&P 500: 2,417
Nasdaq Comp.: 6.413
There is the possibility that Trump will attempt to impede the Mueller investigation, which could result in a constitutional  crisis, an uncertainty the Street can’t ignore.

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TRUMP
It just keeps getting worse. Yesterday a U.S. Court of Appeals for the D.C circuit ruled in favor of Special Counsel Robert Mueller’s action to subpoena an unnamed foreign entity (Russia, Saudi Arabia ?) for something that happened abroad, but directly affects the United States.
      The court procedures were so secret, an entire floor in the court house was in lockdown until a decision was rendered,
The Trump Foundation was forced to dissolve in face of a lawsuit accusing it of  “willful self-dealing” in an abuse of power  resulting in a “shocking pattern of illegality” that also includes Trump’s 2016 presidential campaign.
Special Counsel Robert Mueller is closing in on Trump, et al, and  this is going to get ugly, real ugly.
The daily disclosure of wrongdoing by this administration will weigh heavily on the market at a time the economy is going in the tank and the stock market  on the verge of a bear market.
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THE PRESIDENCY PROBLEM
      An even bigger issue is about to hit the Street right between its eyes and that is, what will happen to stock prices when President Trump is removed from office, or he resigns ?
It’s coming and it won’t be pretty,
in fact odds favor what will be released will stun everyone, even those in denial about what has been happening to our  republic.
There are other issues that can crush the market (debt, fiscal crisis, depression), but extended dysfunction in the highest office in our country has the potential for immeasurable damage to stock prices.
When it gets really  ugly, when stocks are in a tailspin, reason yields to outright fear, pounding market averages to the “I can’t stand it anymore” point where  investors just want OUT!
This is usually at or near the bear market bottom, but not before damage on the magnitude of declines like 50.5% (1998-2000) and 58% (2007-2009).
      Investors must be prepared for the possibility of this happening. If it doesn’t play out that way, be very grateful.
Nine of the last 10 recessions have occurred with a Republican in the White House,
and increasingly, it looks like  it’ll be 10 for 11.
      President Obama inherited the worst recession/bear market since the 1930s, Trump inherited a solid economic recovery, yet in the first 23 months the S&P 500 rose 54% under Obama and only 40% under Trump.
So, which party is better for the Street ?   Go figure.
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TRUMP RESIGNATION

Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
The deal would include family members.
Who would succeed Trump as President ?
       It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
What if Pence resigns first and Trump appoints another Vice President who would then become President ?
It gets complicated and divisive, and that wouldn’t be good for stock prices.
      All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
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We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).
I discontinued the operation December 3 after all had impressive turning patterns except Apple, which has been pounded by the overall rout in the market.
YIELD CURVE:
News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates.
The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
An inverted yield curve has preceded  9 recessions since 1955.
However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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  1. Gary Shilling just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling.
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    IMPORTANT NOTES: How high is high, how long is long
    >
    Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
    >Bear markets start 6 – 12 months ahead of the onset of a recession.

    >Nine out of the last 10 recessions have occurred with a Republican in the White House
    >The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
    >Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
    > 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.
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    Bear Market Perspective

Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target
would be declines of
DJIA: 18,500 (-31.4%)
S&P 500 :  2,150 (-27.0%)
Nasdaq Comp.:5,200 (-36.1%)
But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.
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 28.0 and Q4 17.8%.
However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
>The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry.
>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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
Pending home sales are down 4.6% yoy
> 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
     Why do Republicans deny someone else affordable healthcare ?
How sick is that ?  What is their problem ?  Want it all for themselves ?
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Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.

NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family.
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart !
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.
       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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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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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,  4,200 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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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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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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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 – Neal Kaytel, J.Corsi, Edward Burke, 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.

 

 

 

 

 

 

 

 

 

 

 

Trampoline Effect Drives Stocks Up

  • INVESTORS first read.com – Daily edge before the open        
    DJIA: 22,878
    S&P 500: 2,467
    Nasdaq Comp.:6,554
    Russell 2000: 1,329
    Thursday
    , December 27,  2018    9:07 a.m.
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    gbifr79@gmail.com
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    Sept. 21, 2018 :  Raise cash to 50% (DJIA: 26,656)
    Nov. 8, 2018: Raise cash to 75% (DJIA: 26,180)
    Dec. 26, 2018 Doom Thick Enough for a Rally (DJIA:  21,792)
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    Market Status:
          In spite of yesterday’s  4%-5% jump in stock prices, I want to re-emphasize that I believe the 20% plunge since October  resembles combination of  the 1987 computer-driven wipeout, a harrowing two-month, 36% freefall in the S&P 500, and the 14-month,  50%  bloodbath in 1973-1974, which was triggered by Watergate, Nixon’s resignation, the Mid-east Yom Kippur War, and OPEC’s oil embargo. triggered  by Watergate, Nixon’s resignation, a Mid-east war and OPEC’s oil embargo.
    We have a rare combination of  a vastly oversold market and changes in the Street’s  investment strategy.

·               For years, the Street’s investment strategy relied on computers  programmed with “buy-no-questions-asked” algorithms. Suddenly, this strategy stopped working, requiring changes that reduced buying  while at the same time increased selling with the obvious result – a down market driven by too many institutions trying to exit at the same time.
The market became severely oversold as evidenced by CNN’s index for articles on December 26, the reason for my headline that day, “Doom Thick Enough for a Rally,” which  preceded a  5% bounce in the markets.
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CNN’s index 12/26:
Declines in Asia follow a brutal day for US stock markets after the Dow and S&P 500 suffered their biggest ever Christmas Eve declines

  • Confusing signals from Washington send markets plunging
  • Think Wall Street’s had a bad year? China’s was even worse
  • Stocks suffer worst Christmas Eve declines ever
  • Why Mnuchin’s reassurance about US banks left markets confused
  • Research investment strategist : No signs of a 2019 recession
  • Wall Street craves certainty but all it’s getting is chaos
  • One year after the tax cuts, the market is worse and the economy is a mixed bag
    …………………………………………………
    That kind of gloom almost always precedes big rallies.
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> PRESSTIME:
          Yesterday’s unopposed surge was a reaction to stocks simply plunging too far too soon,  then rebounding sharply (trampoline effect) in a reaction to the oversold condition.
    More so than a technical reaction, the rebound was driven by institutions putting a big slug of client’s cash to work at year-end.
    Based on what I see now, I think this rally can carry into early 2019 where the next leg of a bear market will develop.
          So much depends on the uncertainties which are bedeviling  money managers’ and corporate decision makers’ decision process.
    They are well known: Trump’s irrationality, Mueller, tariffs, interest rates, trend toward recession, international tensions.
          Presently, I see a rally running into 2019 as a “death rattle,” a fake out that sucks a zillion investors into the market, only to betray them with another “trapdoor” effect plunge to new lows.
    TODAY: Look for sellers at the open after such a sharp rebound yesterday.
    The market should find support today at:
    DJIA: 22,392
    S&P 500: 2,417
    Nasdaq Comp.: 6.413
    There is the possibility that Trump will attempt to impede the Mueller investigation, which could result in a constitutional  crisis, an uncertainty the Street can’t ignore.

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    TRUMP
    It just keeps getting worse. Yesterday a U.S. Court of Appeals for the D.C circuit ruled in favor of Special Counsel Robert Mueller’s action to subpoena an unnamed foreign entity (Russia, Saudi Arabia ?) for something that happened abroad, but directly affects the United States.
          The court procedures were so secret, an entire floor in the court house was in lockdown until a decision was rendered,
    The Trump Foundation was forced to dissolve in face of a lawsuit accusing it of  “willful self-dealing” in an abuse of power  resulting in a “shocking pattern of illegality” that also includes Trump’s 2016 presidential campaign.
    Special Counsel Robert Mueller is closing in on Trump, et al, and  this is going to get ugly, real ugly.
    The daily disclosure of wrongdoing by this administration will weigh heavily on the market at a time the economy is going in the tank and the stock market  on the verge of a bear market.
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    THE PRESIDENCY PROBLEM
          An even bigger issue is about to hit the Street right between its eyes and that is, what will happen to stock prices when President Trump is removed from office, or he resigns ?
    It’s coming and it won’t be pretty,
    in fact odds favor what will be released will stun everyone, even those in denial about what has been happening to our  republic.
    There are other issues that can crush the market (debt, fiscal crisis, depression), but extended dysfunction in the highest office in our country has the potential for immeasurable damage to stock prices.
    When it gets really  ugly, when stocks are in a tailspin, reason yields to outright fear, pounding market averages to the “I can’t stand it anymore” point where  investors just want OUT!
    This is usually at or near the bear market bottom, but not before damage on the magnitude of declines like 50.5% (1998-2000) and 58% (2007-2009).
          Investors must be prepared for the possibility of this happening. If it doesn’t play out that way, be very grateful.
    Nine of the last 10 recessions have occurred with a Republican in the White House,
    and increasingly, it looks like  it’ll be 10 for 11.
          President Obama inherited the worst recession/bear market since the 1930s, Trump inherited a solid economic recovery, yet in the first 23 months the S&P 500 rose 54% under Obama and only 40% under Trump.
    So, which party is better for the Street ?   Go figure.
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    TRUMP RESIGNATION

    Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
    The deal would include family members.
    Who would succeed Trump as President ?
           It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
    According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
    What if Pence resigns first and Trump appoints another Vice President who would then become President ?
    It gets complicated and divisive, and that wouldn’t be good for stock prices.
          All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
    …………………………………………….
    We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
    Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
    Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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    APPLE (AAPL) update
    On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).
    I discontinued the operation December 3 after all had impressive turning patterns except Apple, which has been pounded by the overall rout in the market.
    YIELD CURVE:
    News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates.
    The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
    An inverted yield curve has preceded  9 recessions since 1955.
    However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
          So what is a flattening or inverted really telling us /
    It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
    It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
          Should we be concerned ?
    Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
    This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
    …………………………………………
    Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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  1. Gary Shilling just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling.
     >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
    IMPORTANT NOTES: How high is high, how long is long
    >
    Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
    >Bear markets start 6 – 12 months ahead of the onset of a recession.

    >Nine out of the last 10 recessions have occurred with a Republican in the White House
    >The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
    >Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
    > 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.
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
    Bear Market Perspective

Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target
would be declines of
DJIA: 18,500 (-31.4%)
S&P 500 :  2,150 (-27.0%)
Nasdaq Comp.:5,200 (-36.1%)
But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.
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 28.0 and Q4 17.8%.
However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>…
BEARISH CASE
RISING INTEREST RATES:
>The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry.
>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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
Pending home sales are down 4.6% yoy
> 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
     Why do Republicans deny someone else affordable healthcare ?
How sick is that ?  What is their problem ?  Want it all for themselves ?
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Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.

NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family.
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart !
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.
       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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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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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,  4,200 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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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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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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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 – Neal Kaytel, J.Corsi, Edward Burke, 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 “No-Sweat” Market is Suddenly “All Sweat”

INVESTORS first read.com – Daily edge before the open           
DJIA: 22,853
S&P 500: 2,467
Nasdaq Com.: 6,528
Russell 2000: 1,326
Friday, December 21,  2018  9:02 a.m. 
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gbifr79@gmail.com

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Market Status:        
      Suddenly, a buy-no-sweat-market, is all sweat. All Hell is breaking loose.
      Defense Secretary Mattis is resigning with a dire warning to America about Trump’s plan to withdraw from Syria and Afghanistan, described by critics as a “boon”  for adversaries Russia, ISIS, Iran and the Syria regime. Even Republican Senate Majority Leader Mitch McConnell joined the chorus of criticism.
      Least worried is Fed Chief James Powell, who just announced the fourth increase in its federal funds rate this year.
      IMHO, Powell needs to lose the blinders and walk around the block to get a better look at what’s going on. Referring to the economy. Powell said, ”Recent developments  have not fundamentally altered the outlook,” telling investors and traders that their bearish take is 100% wrong.
      WOW !  Geeeeez !  Really ? C’mon,  Seriously ?  100% ?
Not one person other than the main man at the Fed has it right ?
      Clearly, the perfect storm is brewing – This is scary.
      Smart investors jump at adversity to buy, but adversity is just digging its cleats in – more to come.
      With Mattis leaving in February, there is no check on what Trump will do next.
      The economy is beginning to slump, with housing and all its support industries leading the crunch as rising  interest rates bite deeper.
      If the shell-shocked Street and U.S. Senate don’t see it, they will wake up some day with a bear market/recession worse than 2007-2009 on their hands.
      Reality cannot be ignored indefinitely without consequences.
      The Fed hiked its federal funds rate Wednesday to 2.25-2.50 and announced plans to raise it twice  in 2019.  While this was expected, the reality jolted the Street and selling took the major market averages below the levels that have  supported the three market averages for a year –  DJIA:23,500 – 24,000; S&P 500: 2,550 – 2,600; Nasdaq Comp.:6,600-6,800.
     This suggests that a level that was attractive for buying numerous times during the year is no longer attractive, because the  outlook for the future has deteriorated.
      Investors who failed to raise cash in recent months are under pressure to do so now,
      Many will hang tough as stocks skid downward past the “ouch” point until it reaches the “I can’t stand it anymore point” where they are convinced the market is going lower and sell everything, and that’s the bear market bottom.
       I have been through this 13 times, very little has changed. So much of this is human nature – fear and greed.
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AT PRESSTIME:
      Trump just announced, a shutdown would last a very long time.
He is playing a bargaining chip, or on the verge of doing yet another
stupid thing.    Human wrecking ball !
      The market will open mixed, possibly a bit on the upside today as institutions flush with cash to invest will use December’s plunge in prices (worst December since 1931) to scoop up stocks at discounted prices.
       However, o
dds favor another plunge, a very ugly one, that would give the nimble trader a buying opportunity at much lower prices  possibly Monday in early trading.
     If that happens, the DJIA could hit 22,487, the S&P 500: 2,416, Nasdaq Comp.: 6,397.
     If a rally develops here of after another plunge, I would expect it to run out of steam in early January with a nasty plunge into March. Too early to tell, so much happening every day.
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TRUMP
       It just keeps getting worse. Yesterday a U.S. Court of Appeals for the D.C circuit ruled in favor of Special Counsel Robert Mueller’s action to subpoena an unnamed foreign entity (Russia, Saudi Arabia ?) for something that happened abroad, but directly affects the United States.
      The court procedures were so secret, an entire floor in the court house was in lockdown until a decision was rendered,
      The Trump Foundation was forced to dissolve in face of a lawsuit accusing it of  “willful self-dealing” in an abuse of power  resulting in a “shocking pattern of illegality” that also includes Trump’s 2016 presidential campaign.
       Special Counsel Robert Mueller is closing in on Trump, et al, and  this is going to get ugly, real ugly.
      The daily disclosure of wrongdoing by this administration will weigh heavily on the market at a time the economy is going in the tank and the stock market  on the verge of a bear market.
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 THE PRESIDENCY PROBLEM
      An even bigger issue is about to hit the Street right between its eyes and that is, what will happen to stock prices when President Trump is removed from office, or he resigns ?
      It’s coming and it won’t be pretty,
in fact odds favor what will be released will stun everyone, even those in denial about what has been happening to our  republic.
      There are other issues that can crush the market (debt, fiscal crisis, depression), but extended dysfunction in the highest office in our country has the potential for immeasurable damage to stock prices.
      When it gets really  ugly, when stocks are in a tailspin, reason yields to outright fear, pounding market averages to the “I can’t stand it anymore” point where  investors just want OUT!
      This is usually at or near the bear market bottom, but not before damage on the magnitude of declines like 50.5% (1998-2000) and 58% (2007-2009).
      Investors must be prepared for the possibility of this happening. If it doesn’t play out that way, be very grateful.
      Nine of the last 10 recessions have occurred with a Republican in the White House,
and increasingly, it looks like  it’ll be 10 for 11.
      President Obama inherited the worst recession/bear market since the 1930s, Trump inherited a solid economic recovery, yet in the first 23 months the S&P 500 rose 54% under Obama and only 40% under Trump.
      So, which party is better for the Street ?   Go figure.

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TRUMP RESIGNATION

      Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
       The deal would include family members.
       Who would succeed Trump as President ?
       It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
      According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
      What if Pence resigns first and Trump appoints another Vice President who would then become President ?
      It gets complicated and divisive, and that wouldn’t be good for stock prices.
      All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
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      We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
      Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
      Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).  
     I discontinued the operation December 3 after all had impressive turning patterns except Apple, which had slipped below my targeted turning point of 170. The stock is now selling at 166,75, and can drop below 160 before December 28.
YIELD CURVE:
     News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates. 
      The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
      An inverted yield curve has preceded  9 recessions since 1955.
      However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
      It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
       It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
      Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
       This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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        A. Gary Shilling  just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling. 
 
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IMPORTANT NOTES: How high is high, how long is long
>
Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
>Bear markets start 6 – 12 months ahead of the onset of a recession.  
>Nine out of the last 10 recessions have occurred with a Republican in the White House
>The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
>Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
> 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. 
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Bear Market Perspective

      Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
       That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target would be declines of
      DJIA: 18,500 (-31.4%)
      S&P 500 :  2,150 (-27.0%)
      Nasdaq Comp.:5,200 (-36.1%)
      But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
       The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

       A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
       At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.     
      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 28.0 and Q4 17.8%.
      However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
      >The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry. 
      >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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
      Pending home sales are down 4.6% yoy
      > 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
     Why do Republicans deny someone else affordable healthcare ?
How sick is that ?  What is their problem ?  Want it all for themselves ?
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Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.

NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family. 
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart ! 
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
     Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
      According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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      Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.

       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
      While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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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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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,  4,200 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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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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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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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 – Neal Kaytel, J.Corsi, Edward Burke, 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.

 

 

 

 

 

 

Selling Climax/Trader’s Buy Monday Morning

INVESTORS first read.com – Daily edge before the open           
DJIA: 23,323
S&P 500: 2,506
Nasdaq Com.: 6,636
Russell 2000: 1,349
Thursday, December 20,  2018  9:11 a.m. 

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gbifr79@gmail.com

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Market Status:        
     Yesterday, the Fed announced it would hike its federal funds rate to 2.25-2.50 and raise twice  in 2019.  While this was expected, the reality jolted the Street and selling took the major market averages below the major support levels that have  contained the three market averages for a year –  DJIA:23,500 – 24,000; S&P 500: 2,550 – 2,600; Nasdaq Comp.:6,600-6,800.
     This suggests that a level that was attractive for buying numerous times during the year is no longer attractive, because the  outlook for the future has deteriorated.
      Investors who failed to raise cash in recent months are under pressure to do so now,
     This is where “hoping the market rallies one more time” so they can get out overrides their investment decisions and stands to prevent them from raising some cash now. Classic bear market mentality.
         Many will hang tough as stocks skid downward past the “ouch” point until it reaches the “I can’t stand it anymore point” where they are convinced the market is going lower and sell everything, and that’s the bear market bottom. I have been through this 13 times, very little has changed.
     So much of this is human nature – fear and greed.
      What I see is not pretty and it hasn’t gotten ugly yet.  I am most worried about the  ability of the consumer to continue to drive the economy.  That doesn’t just include the poor, it includes most of the rest of our country except the 5% who have the resources to maintain their lifestyle regardless of the economy.
AT PRESSTIME:
     Look for a mixed open with some bargain hunting preventing another washout. Bear in mind, institutions have a major stash of cash to invest and a market that is down 15% in a bit less than three months has to be attractive.
      Whether they have enough firepower to heads off a deeper sell off today will play out in coming weeks.
      The last thing anyone expects now is a sharp rally, and that is a good reason for one to develop. It may Take a gut-wrenching plunge from here today/tomorrow to set that up but it is very possible and could carry into the first week of January when the market would turn down again.
       Would this be the bear market bottom ?  Good grief – NO !
Aside from the stock market’s slide and the housing industry’s huge woes, just about everything looks rosy.
      Bear market bottoms are formed when there is no hope in sight.
      We aren’t even close to that.
       Odds favor another plunge, a very ugly one, that would give the nimble trader a buying opportunity at much lower prices  Friday or Monday in early trading.
        If that happens, the DJIA could hit 22,487, the S&P 500: 2,416, Nasdaq Comp.: 6,397
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TRUMP
       It just keeps getting worse. Yesterday a U.S. Court of Appeals for the D.C circuit ruled in favor of Special Counsel Robert Mueller’s action to subpoena an unnamed foreign entity (Russia, Saudi Arabia ?) for something that happened abroad, but directly affects the United States.
      The court procedures were so secret, an entire floor in the court house was in lockdown until a decision was rendered,
      The Trump Foundation was forced to dissolve in face of a lawsuit accusing it of  “willful self-dealing” in an abuse of power  resulting in a “shocking pattern of illegality” that also includes Trump’s 2016 presidential campaign.
       Special Counsel Robert Mueller is closing in on Trump, et al, and  this is going to get ugly, real ugly.
      The daily disclosure of wrongdoing by this administration will weigh heavily on the market at a time the economy is going in the tank and the stock market  on the verge of a bear market.
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 THE PRESIDENCY PROBLEM
      An even bigger issue is about to hit the Street right between its eyes and that is, what will happen to stock prices when President Trump is removed from office, or he resigns ?
      It’s coming and it won’t be pretty,
in fact odds favor what will be released will stun everyone, even those in denial about what has been happening to our  republic.
      There are other issues that can crush the market (debt, fiscal crisis, depression), but extended dysfunction in the highest office in our country has the potential for immeasurable damage to stock prices.
      When it gets really  ugly, when stocks are in a tailspin, reason yields to outright fear, pounding market averages to the “I can’t stand it anymore” point where  investors just want OUT!
      This is usually at or near the bear market bottom, but not before damage on the magnitude of declines like 50.5% (1998-2000) and 58% (2007-2009).
      Investors must be prepared for the possibility of this happening. If it doesn’t play out that way, be very grateful.
      Nine of the last 10 recessions have occurred with a Republican in the White House,
and increasingly, it looks like  it’ll be 10 for 11.
      President Obama inherited the worst recession/bear market since the 1930s, Trump inherited a solid economic recovery, yet in the first 23 months the S&P 500 rose 54% under Obama and only 40% under Trump.
      So, which party is better for the Street ?   Go figure.

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TRUMP RESIGNATION

      Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
       The deal would include family members.
       Who would succeed Trump as President ?
       It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
      According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
      What if Pence resigns first and Trump appoints another Vice President who would then become President ?
      It gets complicated and divisive, and that wouldn’t be good for stock prices.
      All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
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      We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
      Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
      Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).  
     I discontinued the operation December 3 after all had impressive turning patterns except Apple, which had slipped below my targeted turning point of 170. The stock is now selling at 166,75, and can drop below 160 before December 28.
YIELD CURVE:
     News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates. 
      The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
      An inverted yield curve has preceded  9 recessions since 1955.
      However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
      It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
       It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
      Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
       This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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        A. Gary Shilling  just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling. 
 
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IMPORTANT NOTES: How high is high, how long is long
>
Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
>Bear markets start 6 – 12 months ahead of the onset of a recession.  
>Nine out of the last 10 recessions have occurred with a Republican in the White House
>The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
>Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
> 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. 
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Bear Market Perspective

      Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
       That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target would be declines of
      DJIA: 18,500 (-31.4%)
      S&P 500 :  2,150 (-27.0%)
      Nasdaq Comp.:5,200 (-36.1%)
      But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
       The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

       A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
       At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.     
      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 28.0 and Q4 17.8%.
      However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
      >The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry. 
      >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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
      Pending home sales are down 4.6% yoy
      > 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
     Why do Republicans deny someone else affordable healthcare ?
How sick is that ?  What is their problem ?  Want it all for themselves ?
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Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.

NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family. 
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart ! 
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
     Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
      According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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      Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.

       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
      While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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Benczkowski has recused himself from  the Trump-Russia investigation:
     On November 8, 2017, 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.  Now we learn that he has recused himself.
     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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     Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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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,  4,200 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 – Neal Kaytel, J.Corsi, Edward Burke, 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.

 

 

 

 

 

How Would Trump Resignation Affect Stocks ?

INVESTORS first read.com – Daily edge before the open           
DJIA: 23,592
S&P 500: 2,545
Nasdaq Com.: 6,753
Russell 2000: 1,378
Tuesday, December 18,  2018  9:11 a.m. 
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gbifr79@gmail.com

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Market Status:        
       Yes, I’ll repeat this about the Fed again today and tomorrow, because it is that important. The Street expects a quarter-point increase in the Fed Funds rate Wednesday, investors  must be ready for the possibility the Fed will NOT raise its rate this month, and/or reduce the number of rate increases it plans for 2019 to one or two.
      Such a development would trigger a  rally until investors realize there would be a reason for the Fed changing its policy a global recession is looming.
     
The case against not raising rates is political. The Fed really shouldn’t  opt out, since it would send a message that it is simply a tool of the White House. Trump can only blame himself, he should have kept his mouth shut about rates.
        Most likely, the Fed will raise rates one more time, but put more rate hikes on hold, unless the economy heats up significantly.
THE PRESIDENCY PROBLEM
      An even bigger issue is about to hit the Street right between its eyes and that is, what will happen to stock prices when President Trump is removed from office, or he resigns ?
      It’s coming and it won’t be pretty,
in fact odds favor what will be released will stun everyone, even those in denial about what has been happening to our  republic.
      There are other issues that can crush the market (debt, fiscal crisis, depression), but extended dysfunction in the highest office in our country has the potential for immeasurable damage to stock prices.
      When it gets really  ugly, when stocks are in a tailspin, reason yields to outright fear, pounding market averages to the “I can’t stand it anymore” point where  investors just want OUT!
      This is usually at or near the bear market bottom, but not before damage on the magnitude of declines like 50.5% (1998-2000) and 58% (2007-2009).
      Investors must be prepared for the possibility of this happening. If it doesn’t play out that way, be very grateful.
      Nine of the last 10 recessions have occurred with a Republican in the White House,
and increasingly, it looks like  it’ll be 10 for 11.
      President Obama inherited the worst recession/bear market since the 1930s, Trump inherited a solid economic recovery, yet in the first 23 months the S&P 500 rose 54% under Obama and only 40% under Trump.
      So, which party is better for the Street ?   Go figure.

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TRUMP RESIGNATION

      Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
       The deal would include family members.
       Who would succeed Trump as President ?
       It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
      According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
      What if Pence resigns first and Trump appoints another Vice President who would then become President ?
      It gets complicated and divisive, and that wouldn’t be good for stock prices.
      All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
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      We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
      Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
      Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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At PRESSTIME:
      Stocks will open higher today, probably in hopes of a change in Fed policy, as well as some give by China on trade matters.       
     
Technically, the major support levels that have  contained the three market averages for a year now of DJIA:23,500 – 24,000; S&P 500: 2,550 – 2,600; Nasdaq Comp.:6,600-6,800 must hold, of a major decline from those levels is likely.
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Support “today”DJIA:23,795; S&P 500:2,576; Nasdaq Comp.:6,818
Resistance
today”: DJIA:23,796;S&P:500:2,561; Nasdaq Comp.:6,793
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).  
     I discontinued the operation December 3 after all had impressive turning patterns except Apple, which had slipped below my targeted turning point of 170. The stock is now selling at 168.63, and can drop below 160 before December 28.
YIELD CURVE:
     News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates. 
      The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
      An inverted yield curve has preceded  9 recessions since 1955.
      However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
      It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
       It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
      Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
       This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).
 

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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        A. Gary Shilling  just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling. 
 
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IMPORTANT NOTES: How high is high, how long is long
>
Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
>Bear markets start 6 – 12 months ahead of the onset of a recession.  
>Nine out of the last 10 recessions have occurred with a Republican in the White House
>The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
>Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
> 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. 
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Bear Market Perspective

      Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
       That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target would be declines of
      DJIA: 18,500 (-31.4%)
      S&P 500 :  2,150 (-27.0%)
      Nasdaq Comp.:5,200 (-36.1%)
      But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
       The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

       A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
       At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.     
      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 28.0 and Q4 17.8%.
      However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
      >The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry. 
      >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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
      Pending home sales are down 4.6% yoy
      > 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
     Why do Republicans deny someone else affordable healthcare ?
How sick is that ?  What is their problem ?  Want it all for themselves ?
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Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.


NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family. 
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart ! 
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
     Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
      According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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      Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.

       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
      While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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Benczkowski has recused himself from  the Trump-Russia investigation:
     On November 8, 2017, 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.  Now we learn that he has recused himself.
     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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     Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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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,  4,200 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 – Neal Kaytel, J.Corsi, Edward Burke, 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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Major Support about to Be Tested

INVESTORS first read.com – Daily edge before the open           
DJIA: 24,100
S&P 500: 2,599
Nasdaq Com.: 6,910
Russell 2000: 1,410
Monday, December 17,  2018  9:06 a.m. 

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gbifr79@gmail.com

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Market Status:        
      While the Street expects a quarter-point increase in the Fed Funds rate Wednesday, investors  must be ready for the possibility the Fed will NOT raise its rate this month, and/or reduce the number of rate increases it plans for 2019 to one or two.
      Such a development would trigger a  rally until investors realize there would be a reason for the Fed changing its policy a global recession is looming.
     
The case against not raising rates is political. The Fed really shouldn’t  opt out, since it would send a message that it is simply a tool of the White House. Trump can only blame himself, he should have kept his mouth shut about rates.
      President Trump’s problems are mounting, resignation in face of  a wide range of legal actions is an increasing possibility, which raises a major question for the Street – would the market rise or fall if he is forced out of office ?
      So far, the Street has appeared to be in denial about any of this, if so, the market will drop further.
      But, the Street got what it wanted, a huge tax cut for corporations, but at a huge cost. Trump’s blatant lies and bullying stand to destroy the chances of Republican control  of the Presidency and Congress following the election in 2020, which it doesn’t want, or so it thinks.
      Nine of the last 10 recessions have occurred with a Republican in the White House, and increasingly, it looks like 10 for 11.
      President Obama inherited the worst recession/bear market since the 1930s, Trump inherited a solid economic recovery, yet in the first 23 months the S&P 500 rose 51% under Obama and only 22% under Trump.
      So, which party is better for the Street ?   Go figure.

      It appears that China is giving ground on trade, if so, why is the Street ignoring it ?
      Looks like the Street’s buy-no-matter-what algos blew up, as stock prices tumble.  But don’t successful investors buy when the market has taken a hit, and sell when all couldn’t look better ?
       It is looking like the Fed will bump rates on the 19th, but soft-talk rate increases in 2019.  Sooo many new negatives surfacing.
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TRUMP RESIGNATION

      Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
       The deal would include family members.
       Who would succeed Trump as President ?
       It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
      According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
      What if Pence resigns first and Trump appoints another Vice President who would then become President ?
      It gets complicated and divisive, and that wouldn’t be good for stock prices.
      All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
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      We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
      Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
      Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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At PRESSTIME:
       UGLY ! Looks like a fed funds rate increase this week, and the Street is not excited about some progress by China on trade.
     
 Technically, the major support levels that have  contained the three market averages for a year now of DJIA:23,500 – 24,000; S&P 500: 2,550 – 2,600; Nasdaq Comp.:6,600-6,800 must hold, of a major decline from those levels is likely.
 
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Support “today”: DJIA:23,651 ; S&P 500:2,556; Nasdaq Comp.:6,814
Resistance
today”: DJIA:23,950; S&P:500:2,589; Nasdaq Comp.:6.890
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).  
     I discontinued the operation December 3 after all had impressive turning patterns except Apple, which had slipped below my targeted turning point of 170. The stock is now selling at 168.63, and can drop below 160 before December 28.
YIELD CURVE:
     News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates. 
      The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
      An inverted yield curve has preceded  9 recessions since 1955.
      However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
      It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
       It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
      Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
       This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).
 

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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        A. Gary Shilling  just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling. 
 
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IMPORTANT NOTES: How high is high, how long is long
>
Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
>Bear markets start 6 – 12 months ahead of the onset of a recession.  
>Nine out of the last 10 recessions have occurred with a Republican in the White House
>The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
>Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
> 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. 
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Bear Market Perspective

      Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
       That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target would be declines of
      DJIA: 18,500 (-31.4%)
      S&P 500 :  2,150 (-27.0%)
      Nasdaq Comp.:5,200 (-36.1%)
      But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
       The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

       A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
       At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.     
      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 28.0 and Q4 17.8%.
      However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
      >The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry. 
      >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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
      Pending home sales are down 4.6% yoy
      > 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

Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.


NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family. 
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart ! 
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
     Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
      According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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      Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.

       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
      While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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Benczkowski has recused himself from  the Trump-Russia investigation:
     On November 8, 2017, 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.  Now we learn that he has recused himself.
     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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     Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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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,  4,200 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 – Neal Kaytel, J.Corsi, Edward Burke, 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 Desperately Need Fed Help – Possibility of Trump Resignation Looms


INVESTORS first read.com – Daily edge before the open           
DJIA: 24,597
S&P 500: 2,650
Nasdaq Com.: 7,070
Russell 2000: 1,432
Friday, December 14,  2018  8:12 a.m. 
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gbifr79@gmail.com

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Market Status: 
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      While the Street expects a quarter-point increase in the Fed Funds rate next Wednesday, investors  must be ready for the possibility the Fed will NOT raise its rate this month, and/or reduce the number of rate increases it plans for 2019 to one or two.
       Such a development would trigger a sharp rally until investors realize there would be a reason for the Fed changing its policy a global recession is looming.
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TRUMP RESIGNATION

      Investors must be ready for a resignation by President Trump who would cut a deal to trade his presidency for a get out of jail “sort of free” card, in face of incredible string of illegal activities.
       The deal would include family members.
       Who would succeed Trump as President ?
       It is possible, Vice President Pence would also be at risk and forced to resign, since he was Chair of the President-Elect Trump campaign, which is now under intense scrutiny.
      According to the Succession Act of 1947, the Speaker of the House, Nancy Pelosi,  would be next in line to become President if both Trump and Pence are forced out of office, and that would cause a monstrous firestorm.
      What if Pence resigns first and Trump appoints another Vice President who would then become President ?
      It gets complicated and divisive, and that wouldn’t be good for stock prices.
      All this is possible, in my opinion – probable, and would  most likely crush stock prices until resolved.
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      We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
      Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
      Technically, the major support levels that have  contained the three market averages for a year now of DJIA:23,500 – 24,000; S&P 500: 2,550 – 2,600; Nasdaq Comp.:6,600-6,800 must hold, of a major decline from those levels is likely.
      Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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At PRESSTIME:
      This market is acting like a bear market, it has to be assumed to be a bear market unless the bulls prove otherwise.
       The only positive is so many institutions and investors are becoming bearish, which is just one of the conditions present at market bottoms.
       The market will open lower. So far, the bulls have not shown an appetite for stocks even at  these discounted prices.
      As noted above, the Fed can trigger a rally
with an announcement next Wednesday of a major change in policy toward ease.
      While rumors of progress in the U.S./China trade war can bump stocks up, tangible evidence is needed for a rally to be significant.
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Support “today”: DJIA: 24,276; S&P 500:2,624; Nasdaq Comp.:6,990
Resistance
today”: DJIA:24,639; S&P:500:2,654; Nasdaq Comp.:7,080
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).  
     I discontinued the operation December 3 after all had impressive turning patterns except Apple, which had slipped below my targeted turning point of 170. The stock is now selling at 168.63, and can drop below 160 before December 28.
YIELD CURVE:
     News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates. 
      The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
      An inverted yield curve has preceded  9 recessions since 1955.
      However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
      It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
       It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
      Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
       This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).
 

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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        A. Gary Shilling  just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling. 
 
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IMPORTANT NOTES: How high is high, how long is long
>
Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
>Bear markets start 6 – 12 months ahead of the onset of a recession.  
>Nine out of the last 10 recessions have occurred with a Republican in the White House
>The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
>Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
> 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. 
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Bear Market Perspective

      Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
       That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target would be declines of
      DJIA: 18,500 (-31.4%)
      S&P 500 :  2,150 (-27.0%)
      Nasdaq Comp.:5,200 (-36.1%)
      But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
       The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

       A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
       At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.     
      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 28.0 and Q4 17.8%.
      However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
      >The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry. 
      >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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
      Pending home sales are down 4.6% yoy
      > 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

Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.


NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family. 
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart ! 
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
     Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
      According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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      Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.

       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
      While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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Benczkowski has recused himself from  the Trump-Russia investigation:
     On November 8, 2017, 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.  Now we learn that he has recused himself.
     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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     Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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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,  4,200 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 – Neal Kaytel, J.Corsi, Edward Burke, 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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CFOs Surveyed See Recession in 2019

INVESTORS first read.com – Daily edge before the open           
DJIA: 24,527
S&P 500: 2,651
Nasdaq Com.: 7,098
Russell 2000: 1,455
Thursday, December 13,  2018  8:12 a.m. 

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gbifr79@gmail.com

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NOTE: I will be changing over to another computer system this week
and may not be able to post a blog on one or two days.
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Market Status: 
JUST OUT: 48.6%  of U.S. chief financial officers (CFOs) believe  the United States will be in a recession by the end of 2019, according to Duke University/CFO Global Business Outlook  survey. Up to 82% believe it will strike by year-end 2020.  It’s nice to have company, I’ve been projecting that for over six months.
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The bulls should have done a better job  of moving the ball yesterday. After a big burst of strength at the open, the market closed at the lows for the day.

      I have always considered  December’s trading  behavior through year-end  a misleading enigma.  Stocks that are expected to go up, go down, stocks that are expected to go down, go up.
      Credit this to portfolio adjustments where institutions dump stocks that performed poorly, and pad portfolios with stocks that clients will feel comfy with in the year-end reports.  Tax selling can also be an issue.
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The following needs to be repeated from Wednesday’s post  
       Investors should be aware of the possibility the Fed will act next week to counter the creeping bearish sentiment in the investment and business community.
      Its eight increases in its benchmark  Fed funds rate  since December 2015 have crushed the housing market and flattened the yield curve (see below: Yield Curve).
      They can opt not to increase rates on Wednesday, December 19, or flood the market with commentary about opting out of rate increases next year, for which at least 3 were expected.
      The Fed is in a quandary, they are damned if they raise rates, damned if they don’t. By simply abandoning a policy of gradual tightening, they lose credibility by admitting they erred in the first place. 
     By increasing  the rate this month, but not backing away from increases in 2019, they will be accelerating the trend toward recession already underway.
       The period between November 1 and April 1 is the best six months for owning stocks. The period boasts an outstanding record for consistency, as detailed in the Stock Trader’s Almanac, a must read annual compendium of what you need to know about daily, weekly, monthly, yearly cycles and seasonality. Published annually, I got my first Almanac in 1968. An excellent holiday gift. Call 800-762-2974.  Really amazing stuff, time-tested, widely quoted.
      With the S&P 500 down 10.3% from its October 8 high, odds favor institutions will be picking stocks up going into year-end.
      But they will encounter sellers along the way. 
        We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
      Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
      Finally, we have a dysfunctional administration, which has already created more problems than it has solved and will continue to do so.  This weighs heavily on investor confidence, as well as decisions by corporate managers who find planning for the future difficult.
       Technically, the major support levels that have  contained the three market averages for a year now of DJIA:23,500 – 24,000; S&P 500: 2,550 – 2,600; Nasdaq Comp.:6,600-6,800 must hold, of a major decline from those levels is likely.
      Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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At PRESSTIME:
               Institutions have fistfuls of cash to invest at this time and a 10% drop in the overall market since October makes decisions to buy more attractive
.
        But the bulls should have done better yesterday. Apparently they ran into a wall a smidge above my Resistance levels.   All three major market averages closed at the lows for the day. That shouldn’t happen if the bulls were going to make a big run.
     Like I said above, reading a trend in the market in December is easier in hindsight than foresight, just to much going on that has little to do with conventional buy/sell decisions.
      This market is acting like a bear market, it has to be assumed to be a bear market unless the bulls prove otherwise.
       As noted above, 48.6% of CFOs polled expect a recession to begin next year. That is one reason I expect the Fed to tread softly on further rate increases.  They may pass on an expected rate increase next Wednesday in which case the market will soar, or they may opt to defer on increases in 2019, which would trigger a less robust rally.  I still see a recession starting next year, it has quietly already started.  I still think the market has more downside, how much depends on what new negatives hit it on the way down.

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Support “today”: DJIA: 24,401; S&P 500:2,641 ; Nasdaq Comp.:7.056
Resistance
today”: DJIA24,637:; S&P:500:2,661; Nasdaq Comp.:7,119
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).  
     I discontinued the operation December 3 after all had impressive turning patterns except Apple, which had slipped below my targeted turning point of 170. The stock is now selling at 168.63, and can drop below 160 before December 28.
YIELD CURVE:
     News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates. 
      The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
      An inverted yield curve has preceded  9 recessions since 1955.
      However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
      It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
       It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
      Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
       This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).
 

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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        A. Gary Shilling  just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling. 
 
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IMPORTANT NOTES: How high is high, how long is long
>
Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
>Bear markets start 6 – 12 months ahead of the onset of a recession.  
>Nine out of the last 10 recessions have occurred with a Republican in the White House
>The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
>Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
> 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. 
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Bear Market Perspective

      Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
       That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target would be declines of
      DJIA: 18,500 (-31.4%)
      S&P 500 :  2,150 (-27.0%)
      Nasdaq Comp.:5,200 (-36.1%)
      But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
       The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

       A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
       At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.     
      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 28.0 and Q4 17.8%.
      However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
      >The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry. 
      >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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
      Pending home sales are down 4.6% yoy
      > 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

Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.


NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family. 
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart ! 
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
     Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
      According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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      Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.

       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
      While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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Benczkowski has recused himself from  the Trump-Russia investigation:
     On November 8, 2017, 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.  Now we learn that he has recused himself.
     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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     Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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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,  4,200 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 – Neal Kaytel, J.Corsi, Edward Burke, 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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trade-Progress Rally Has Some Room to Run – Institutions Year-End Buying, a Help

INVESTORS first read.com – Daily edge before the open           
DJIA:24,370
S&P 500: 2,636
Nasdaq Com.: 7,031
Russell 2000: 1,440
Wednesday , December 12,  2018  9:12 a.m. 

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gbifr79@gmail.com

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NOTE: I will be changing over to another computer system this week
and may not be able to post a blog on one or two days.
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Market Status: 
      Investors should be aware of the possibility the Fed will act next week to counter the creeping bearish sentiment in the investment and business community.
      Its eight increases in its benchmark  Fed funds rate  since December 2015 have crushed the housing market and flattened the yield curve (see below: Yield Curve).
      They can opt not to increase rates on Wednesday, December 19, or flood the market with commentary about opting out of rate increases next year, for which at least 3 were expected.
      The Fed is in a quandary, they are damned if they raise rates, damned if they don’t. By simply abandoning a policy of gradual tightening, they lose credibility by admitting they erred in the first place. 
     By increasing  the rate this month, but not backing away from increases in 2019, they will be accelerating the trend toward recession already underway.
       The period between November 1 and April 1 is the best six months for owning stocks. The period boasts an outstanding record for consistency, as detailed in the Stock Trader’s Almanac, a must read annual compendium of what you need to know about daily, weekly, monthly, yearly cycles and seasonality. Published annually, I got my first Almanac in 1968. An excellent holiday gift. Call 800-762-2974.  Really amazing stuff, time-tested, widely quoted.
      With the S&P 500 down 10.3% from its October 8 high, odds favor institutions will be picking stocks up going into year-end.
      But they will encounter sellers along the way. 
        We are in the late innings of an economic expansion, so a recession is a good bet. The current expansion started in June 2009, has lasted 126 months, the longest on record and more than twice as long as the average length of 11 cycles since 1945.
      Bear markets lead the beginning of recessions by 3 to 12 months.  The current bull market at 130 months is four times the average of the last 15 bulls going back to 1957.
      Finally, we have a dysfunctional administration, which has already created more problems than it has solved and will continue to do so.  This weighs heavily on investor confidence, as well as decisions by corporate managers who find planning for the future difficult.
       Technically, the major support levels that have  contained the three market averages for a year now of DJIA:23,500 – 24,000; S&P 500: 2,550 – 2,600; Nasdaq Comp.:6,600-6,800 must hold, of a major decline from those levels is likely.
      Any rally here MUST be overwhelmingly powerful and unrelenting.  Like all rallies in face of major unresolved problems, it carries great risks.
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At PRESSTIME:
       Any sustained rally needs help from the Fed, as well as a break through on the trade war debacle.
Tangible progress on tariffs is unlikely soon, but not unfounded rumors from time to time that will raise hopes and trigger temporary rallies.
        Institutions have fistfuls of cash to invest at this time and a 10% drop in  the overall market (much more for some stocks) makes buying easier.
        But, the Street is aware of the risk of a recession/bear market is a real possibility and will walk away in face of  new negatives. Buying has risks.
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Resistance “today”: DJIA:24,701, S&P:500:2,671; Nasdaq Comp.:7,116
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APPLE (AAPL) update
On November 15, I started to track “Traders” Favorites  that were in a tailspin, seeking to target levels where they would turn around. They were Facebook (FB), Amazon(AMZN), Netflix (NFLX), Alphabet (GOOG), and Apple (AAPL).  
     I discontinued the operation December 3 after all had impressive turning patterns except Apple which has slipped below my targeted turning point of 170. The stock is now selling at 168.63, and can drop below 160 before December 28.
YIELD CURVE:
     News of the yield curve flattening, worse yet “inverting”  has begun to weigh heavily on the stock market. The curve is measured by the difference between short, and long-term interest rates. 
      The curve flattens when the short and long-term rates are nearly  the same. They invert when short rates exceed long rates.
      An inverted yield curve has preceded  9 recessions since 1955.
      However, this event’s forecasting problem is that there can be a lag time before a recession hits of one to three years. An inversion predicted the 2007 financial crisis by 24 months.
      So what is a flattening or inverted really telling us /
      It is indicating the Federal Reserve is tightening credit by forcing short-term treasury rates close to or higher than long-term rates.in an effort to slow growth in the economy so it doesn’t overheat and trigger a surge in the inflation rate.
       It is also saying that investors expect a recession, which will result in lower rates and they want to lock those in before that happens.
      Should we be concerned ?
      Yes, because the Street gets spooked when the curve flattens, it is a warning that the Fed is getting serious about tapping the brakes on the economy, and buy programs cut back, or sell programs initiated.
       This has probably already started, however I think the Fed may be concerned it has gone too far and may want to tap the brakes on its own policy !
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Technical Note: Frequently, there is what I refer to as a mid-afternoon counter move (2:30 – 3:00 where the market rallies or declines against the prevailing trend for the day.   This can be a fake out for investors thinking the market has turned (up or down).
 

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Economic Status: Late stage expansion with recession starting in late 2019. Bull markets hit peak 6 to 12 months ahead of recessions. Republicans were in White House in 9 of  the last 10 recessions. Their rosy projections ignore the likelihood of a recession within a year to 18 months. Housing and auto industries already in recession. The crunch can gain momentum ahead of schedule. U.S. fiscal crisis looms 2-3 years out.
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        A. Gary Shilling  just turned bearish in his November issue, headlining his issue of “INSUGHT“ with “Looming Recession ?”   I have tracked Shilling for decades. He nailed the 2007 – 2009 Great Recession Bear Market before anyone else. For him to suddenly turn negative is  a shocker.  He details his reasons in a 50-page analysis that  is overwhelming in detail and backed up with stats and graphs. No one in my experience has more economic/investing integrity than Shilling. 
 
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IMPORTANT NOTES: How high is high, how long is long
>
Through September, this bull market is 116 months old, or 3.5 times longer than the average of the last  15  bull markets..
>Bear markets start 6 – 12 months ahead of the onset of a recession.  
>Nine out of the last 10 recessions have occurred with a Republican in the White House
>The current economic expansion has lasted 123 months. That’s 65 months (2.1x) longer than the average expansion (58.4 months) going back to 1945.
>Of the 10 recessions since 1950,the average time between the low point in the unemployment rate and the start of a recession was 3.8 Months.
> 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. 
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Bear Market Perspective

      Officially, we are not in a bear market until the S&P 500 declines 20% (2,352).  That would translate into DJIA 21,560 – “ouch” !
       That’s the minimum drop for a bear, but the last two bears crushed the S&P 500 by 57% (2007-2009) and 50% (2000-2002).  
My bear market target would be declines of
      DJIA: 18,500 (-31.4%)
      S&P 500 :  2,150 (-27.0%)
      Nasdaq Comp.:5,200 (-36.1%)
      But, depending on what new negatives hit the market when it gets down there, the bear market could reach much, much  lower levels.
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EARNINGS GROWTH MYTH:
       The Street is counting on earnings growth to reduce the overvaluation of equities.   Look again.

       A 20% increase in S&P 500 earnings this year will  be tough to beat next year.  The quarter versus year ago quarters in 2019 will make poor reading going up against the 2018 earnings, possibly earnings growth around  5%. But the Street is not factoring in the likelihood of a recession, which could mean negative growth.
       At times, politics has little impact on the big  picture. This time is different.

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BULLISH CASE
       It is possible the Fed has backpedaled from a policy of tightening credit through increases in its fed funds rate.  If that plays out, the decline I am expecting will be delayed.     
      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 28.0 and Q4 17.8%.
      However 2019 is a different story with earnings increases of Q1: +4.6%, Q2:6.7%,  Q3: +4.6% and Q4: +9.5%, with 2019 coming is at +8.8%
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BEARISH CASE
RISING INTEREST RATES:
      >The Fed may be retreating from its policy of increasing its benchmark interest rate (federal funds), though more information is needed. It has raised rates eight times since December 2015. That policy has led toan ugly slump in the housing industry. 
      >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 30.8  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 18.1 times earnings and 16.2 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 112 months. That’s 53 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 30.5%, as interest rates rise. Not only is it  major employer, its health affects other industries, especially furniture and appliances.
      Pending home sales are down 4.6% yoy
      > 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

Butina cuts plea deal – bad news for NRA and Republicans:
Alleged Russian spy, Maria Butina,  has just cut a plea deal to cooperate with federal prosecutors (not Mueller), which is bad news for Certain Republicans who accepted Russian money through the NRA, which bankrolled Trump’s campaign to the tune of $30 million, as well as other Republicans, who may not be aware of the source.  Clearly, they wouldn’t want that source to become public, if in fact that was the case. This was reported by Palmerreports.com Tuesday morning.


NEW TERM:  Stochastic terrorist – terrorism that employs the use of mass media to provoke random acts of ideologically motivated violence that are  statistically predictable but individually unpredictable like the CNN bomb scare and similar threats against Hillary Clinton and President Obama.  That comes from PAlmerreports.com, as well as the following.
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PENCE is TOAST, as well  ?  Trump had planned to replace Chief of Staff, John Kelly, with V.P. Mike Pence’s Chief of Staff, Nick Ayers, but suddenly Ayers backed out of both, citing the need to spend more time with family. 
hmmmmm.
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COWARDS ? Now is the time for the Republican-controlled Senate to do the American thing and protect the Special Counsel from  President Trump’s effort to undermine it.  This is no longer politics in general, this is about whether or not we are a nation of laws. Failure to do that, and I am convinced certain members of Congress are constitutional anarchists determined to destroy our republic.
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Rogue wave…. or monstrous blue wave ?
Real Americans are rising up to save our republic, and all the quality of life things worked and died for over the years.   After 2020, the right wing Republicans will be irrelevant, forced to climb back under the rock from which they emerged.
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What in the  Hell is wrong with us ?  These Central American peoples of all ages are willing to trek thousands of miles to attempt to enter America, and we are sending troops to back up border control to deny them legal entrance.  SHAME on our President, the selfish Republican party.  By their admirable efforts, they are demonstrating the kind of resolve we want in our workforce.
Christian ?   No, freaking way.  Our leaders are the epitome of  the  anti-Christ !  Hypocrites and un-American at heart ! 
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Trump has proposed a  5 percent budget cut for each Cabinet agency yesterday.
     Wait just a minute !
Didn’t Congress pass a $1.3trillion catchall spending bill earlier in the year after passing the Tax Cuts and Jobs Act in December, which gave corporations a 40% tax cut, and was skewed heavily in favor of big earners with the rest of the country getting a cut around 1%.
      According to the Treasury Dept. the federal deficit for FY Sept. 30 was $779 billion, up 17% from a year ago primarily due to the shortfall in revenues from corporations as a result of their huge tax cuts.
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Bath Iron Works (Maine) Gets $3.9 billion Navy Award 7 days before Sen. Collin’s “Yes” Vote for Kavanaugh
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      Reecntly, Bill Palmer, PalmerReports.com, gave his reason why Nikki Haley resigned from her post as United Nations Ambassador.

       The story was carried in more detail by the Business Insider.com, which points to her resignation one day after Citizens for Responsibility and Ethics in Washington (CREW) requested the State Dept. investigate her acceptance of seven free flights aboard private jets  from three South Carolina business men.
      While she listed the flights on her 2017 financial disclosure, the information was incomplete according to CREW and did not qualify for an exemption.
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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.
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Trump in hot water on tax evasion and the legitimacy of his inheritance ?
We’ll see !!
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     Since Deputy Atty Gen’l Rod Rosenstein would not fire Special Counsel Robert Mueller, assuming Trump first fired Rosenstein.
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Benczkowski has recused himself from  the Trump-Russia investigation:
     On November 8, 2017, 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.  Now we learn that he has recused himself.
     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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     Palmerreport.com believes Roger Stone will be the next person indicted/arrested by Special Counsel Robert Mueller.
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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,  4,200 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 – Neal Kaytel, J.Corsi, Edward Burke, 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.