Doubts Creeping In

Investor’s first read – Daily edge before the open
DJIA: 21,287
S&P 500:2,419
Nasdaq  Comp.:6,144
Russell 2000: 1,416
Friday , June 30, 2017    8:50 a.m.
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Yesterday’s plunge in stock prices confirms my warnings (Tuesday headline “Uh Oh !”) that the hot money was using any strength in hot stocks like Facebook (FB), Amazon (AMZN), APPLE (AAPL), Microsoft (MSFT), and Alphabet (GOOG), to sell.
       The Street is finally concerned that the big stimulus it has been salivating over may not come soon enough, or in the size the Street had hoped for.

        The election of Donald Trump  and his promises of tax cuts, deregulation and a big spend on the infrastructure and/or the military, triggered a 13.1% surge in the S&P 500 on top of an already historically over-priced  market.
         The Street has  programmed its algorithms to buy on any weakness.  We will see now if analysts have stepped in to alter those algos to take into consideration the uncertainty of President Trump.
         If so, there is more downside. If not, expect stability after a bit more slippage.                                                                                               >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”:DJIA:21,137;S&P 500:2,401:Nasdaq Comp.:6,036
RESISTANCE “today” DJIA:21,361;S&P 500:2,437;Nasdaq Comp.:6,181

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CORPORATE EARNINGS
(updated June 23, 2017)
Factset
      Q1 earnings increased  14.0%.      Q2 growth  is projected at +6.6 %, Q3 at +7.4%, and Q4 at +12.4%. For 2017 as a whole growth is projected at a plus 9.8%.  Currently, the P/E on forward  earnings is 17.6 x. That compares with a 10-year average P/E of 14.0.
Note: These numbers change frequently.
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MY TECHNICAL ANALYSIS  of the 30 DJIA Companies
:  (UPDATED 6/13/17)
      On occasion, I technically analyze each of the 30 DJIA stocks  for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
      As of  June 15, 2017,  a reasonable risk is 21,951 a more extreme risk is 20,703.Near-term upside potential is 21,418.
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POLITICAL/STOCK MARKET
NOTE: I have retained a lot of the copy here for new readers, but also because it is relevant, since assumptions and information here are confirmed by unfolding news.
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TRUMP approval ratings also abysmal abroad.

      July 4th is a time Americans celebrate the birth of our nation, a time Americans take a minute to be proud of our constitutional representative republic and its many accomplishments, which unfortunately are systematically being gutted as I write.
       Unfortunately, our image has dropped sharply under Trump as president. His approval ratings wallow  in the 30s, as he has hastened to disengage the U.S. from our long-standing foreign alliances.
      A recent Pew Research Center survey covering 37 countries gives Trump a 22% confidence rating that he would do the right thing in international affairs. President Obama’s rating in the same category as he left office was 64%.
      Trump’s plunge is especially pronounced among our closest allies in Europe and Asia.
       American people as a group came out well in the poll with a median of 58% favorable.

       Trump sucks wind in comparison with other major world leaders in the do the right thing category, trailing Germany’s Angela Merkel (#1), China’s Xi Jinping, Russia’s Vladimir Putin.
        Disapproval of Trump’s signature policies was obvious with abysmal approval ratings for his: withdrawal of support from  the Iran nuclear weapons agreement (34%); restrictions on immigrants entering the U.S. (32%); withdrawal from the international climate change agreement (19%); withdrawal of support for major trade agreements (18%; building the “Wall” (16%).

         Trump’s personality assessment is disturbing with 75% of the 37 countries saying he is arrogant, 65% saying he is intolerant, 62% dangerous, 55% a strong leader, 39% charismatic, 26% qualified to be president, 23% caring about people.
          So my headline on January 3, “TRUMP – A Human Wrecking Ball” is confirmed globally, as well.
          
There is a chance, a big one, that Trump and the Freedom Caucus (Constitutional anarchists) will do irreparable damage to our nation domestically and internationally in coming years, when Fourth of July celebrations will be for a nation “that was.”  
            This combination wants to shred everything accomplished in the last 230 years, then remake it to reflect their hard right ideology.

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Better Care Reconciliation ACT (BCRA) aka, Trumpcare       
     
It looks like a final vote on the Senate healthcare vote will be delayed until after the July 4th recess.  It also looks like serious concessions will have to be made to pass it.
       But who gets the concessions – conservatives or moderates ?
       Ideology absolutely has no place  in this bill – NONE ! Have they no SHAME !

     This bill has been developed in secret by a handful of Republicans, and no Democrats, yet it will affect all Americans.   It should be crafted to serve the best interests of Americans who need affordable health insurance coverage.  Anything short of that is not in the best interests of our country, i.e., hostile, un-American.
        Ironically, most of Congress is covered by ACA, which was implemented in place of the Federal Employees Health Benefit Plan, when ACA became the law of the land.  So, Congress has some skin in the game……well, kind of.
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FLIPPING VOTES: 
      It doesn’t matter
if Russia was not able to hack into voting machines and flip Clinton votes  to Trump, if  Russia’s intrusion into Facebook and Twitter with  “fake” news was  able to convince voters before they voted that Clinton was seriously flawed and Trump the preferred choice.

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TRUMP TO PUT US  ON  A WAR FOOTING !
       I moved this one up in the queue, due to a recent Trump tweet that help from China “has not worked.”
       On January 12, I noted:
       “I am sure of one thing, the United States will be on a war footing in the spring of 2018. Two things, it will juice the economy….may push war hawks to act on military expenditures; two, ensure support for the mid-term elections.
(Investor’s first read.com.)
       In April, Trump told the Financial Times, “If China is not going to solve North Korea, we will.” In June, he said, “While I greatly appreciate the efforts of President Xi & China to help with North Korea, it has not worked out.”
       This looks like a countdown to military action, or brinkmanship so dire that North Korea comes to the table. 
        Strategically, Trump would want to put the country on a war footing  with North Korea closer to the election in 2018, but if the Russia investigation gets too hot, he may want to begin the process earlier as a distraction.
WHAT ABOUT SYRIA AND CHEMICAL WEAPONS ?
      Another diversion to deflect attention away from yet another healthcare setback and the Russia/Trump investigation.
      The only thing I am certain of is that this administration is the most untruthful administration in the 57 years I have been following politics.  What an utter disgrace.  We will be lucky to get out of this without an enormous amount of damage across the board.
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       I have added Jill Stein, Green Party presidential candidate, to my list of “Connect the Dots” (see below).  Stein was sitting at the widely distributed photo where she and Michael Flynn were sitting at the dinner table with Vladimir Putin on December 15, 2015, a celebration of the 10th anniversary of Russian Network TV (RT).  Asked why she was there she replied, “The soiree was a great opportunity to layout some of my foreign policy proposals and get Russian reaction.”  
       Worth noting, Stein got enough votes in the Michigan, Wisconsin and Pennsylvania to give the electoral college vote to Trump “assuming” her votes would have gone to Clinton, which she claims would not be the case.  In all fairness, the Johnson/Weld ticket got three time as many votes as Stein in those states, and they weren’t dining with Putin.
      Why was Stein at the table ? Reportedly, she said her campaign was heavily promoted by RT. She told NBC’s Alex Seitz-Wald, “ And my own connection to RT, you know ironically, it takes a Russian television station to actually be open to independent candidates in this country and that is a shame. A shameful commentary on own media.” IMHO, Stein did nothing wrong, and is probably right about our own media which gave Trump a disgusting amount of free publicity, including liberal press MSNBC. Stein may have valuable input, since she was mixing with Russians at the highest levels.
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ROSENSTEIN OUT ?      Who Takes Over ?
     Expect Rod Rosenstein, Deputy Attorney General – DOJ will  likely be fired or have to recuse himself possibly as soon as this week, odds favor the latter. The real target here would be special counsel, Robert Mueller, who would be fired as a desperation stalling tactic by President Trump ‘if’” Trump can find an attorney general who would fire Mueller.  Trump cannot fire Mueller directly.
      Obviously,  firing Mueller would smack of  “consciousness of guilt,” and could lead to impeachment proceedings by the House, and/or increase pressure for Trump to resign..

      With Rosenstein out of the way,  associate attorney general, Rachel Brand, would take over.  If she resigns, or is fired, Dana Boente, U.S. attorney general for the Eastern District of Virginia would take over.
       I believe this scandal reaches far beyond collusion with Russia to get Trump elected.

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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.” Intitially, 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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“Connect the Dots.” This investigation is open-ended
       Nigel Farage – President Trump- Jeffrey Sessions – Robert Mercer – Cambridge Analytics – Bannon- Carter Page – Kushner (Jared and Ivanka) – Eric Prince – Donald and Eric Trump – Wilbur Ross –  Michael Cohen – Ezra Cohen Watnick – Flynn – JD Gordon  –  Christopher Steele – Michael Caputo -Breitbart – Roger Stone – Julian Assange – Paul Manafort – Rick Gates – Jill Stein – Russia’s Felix Sater – Sergey Gorkov –  Sergey Kislak, ambassador to the U.S..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.
      Additionally,  Vice President Mike Pence simply had to be aware of what was happening in the campaign, but is being shielded because he is the second in command if  President Trump is impeached and convicted  or forced to resign. Stephen Miller, Joseph E. Schmitz may be of interest to the FBI for information they possess relating to the FBI investigation.
      According to CNN Politics,  Marc Kasowitz has represented Trump for personal and business matters for years. Worth noting, Kasowitz is defending Russian bank, OJSC Sberbank in U.S. court, as well as a Russian billionaire, Oleg Deripaska, who has close ties with the Kremlin. 
       WHY SO MANY RUSSIANS ? WHY ALL THESE RUSSIAN CONNECTIONS ?  THIS IS GETTING BIGGER – IMHO THIS WILL BE THE BIGGEST SCANDAL “EVER” AND MAY TAKE YEARS TO FULLY UNWIND.
          Was there a GLOBAL POWER PLAY here ?  Britain, United States, France, Netherlands, Sweden, Italy ?   Who was the puppeteer who were the puppets ?
        The new kid on the FBI “person of interest” block in its US counter-intelligence investigation is Nigel Farage, a Brit, former UK Independence Party (UKIP)  leader and tactician for Brexit. He may be positioned to have a lot of pertinent information about 2016 election tampering. Reportedly, he has had direct or indirect contact with all of the above.  …………………………………………………………………………………..
  President Trump’s budget is obviously DOA, with lots of blowback by Republicans looking to their prospects of re-election in 2018. The budget is a disgrace to who we are as Americans, as it skewers a portion of our society with little ability to defend itself, much less survive.
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 OPINION: We are heading down a deep and perilous path, one that will test the full extent of our country as a republic. More importantly, we will be tested as Americans, as a country that can meet challenges with rational solutions and foresight to anticipate the needs of the future.  The politics of extremism and divisiveness are capable of destroying us from within.

      As a nation, we have been blindsided by the devious use of unsubstantiated social media, radio and  cable television content that pitches lies, misinformation and bias to drive a wedge deeper and deeper between Americans.

      This is all about total control, achieved by any means, legal or illegal, honorable or dishonorable. Americans must learn to mentally and emotionally process information accurately, in depth, and without social or political bias. That, or wake up some day as mere subjects of the  special and narrow interests of a quasi totalitarian state, once known as a constitutional representative republic, which championed the rights and protections of all individuals not a privileged political minority.
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Note:
Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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