LIBOR is being phased out and the bankers are bringing in another system, the manipulation will not end. Brussels says that the UK cannot make a trade deal with the US. SEC says that the crypto currency ICO falls under securities laws. Home ownership is at the level of the 60’s and more millennials are renting. Core durable goods rise by a small amount. Investment legend is warning that we are approaching a 1987 time period. The Fed is now using the excuse that if the debt ceiling doesn’t go well they will not unwind their balance sheet. The economy is crashing and the way of life is going to change and many people are not prepared for it. The case with Debbie Wasserman Shultz gets shadier and shadier. EU is forcing Poland and other countries to take refugees. CIA director made the statement that he would like to see regime change in NK & NK responding that they will defend themselves. Syrian rebels have been given an ultimatum to surrender or be destroyed. Russia just signed agreement to stay in Syria for another 50 years.
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Current News – 07.27.2017
- Unofficially, Libor died some time in 2012 when what until then was a giant “conspiracy theory” – namely that the world’s most important reference index, setting the price for $350 trillion in loans, credit and derivative securities had been rigged for years – was confirmed. Officially, Libor died earlier today when the top U.K. regulator, the Financial Conduct Authority which regulates Libor, said the scandal-plagued index would be phased out and that work would begin for a transition to alternate, and still undetermined, benchmarks by the end of 2021.
- The Fed has already been gearing up for the replacement: last month the Alternative Reference Rates Committee, a group made up of the largest US banks, voted to use a benchmark based on short-term loans known as repurchase agreements or “repo” trades, backed by Treasury securities, to replace U.S. dollar Libor.
- A FORMER European Union trade commissioner has warned Britain the bloc can thwart any potential trade deal with Donald Trump’s United States if a transitional Brexit is agreed.
- Karel De Gucht said, in no uncertain terms, Brussels would not allow Theresa May to sign any global trade agreements if the UK maintains “access” to the bloc’s single market.
- The Belgian politician, who is also a close ally of arch federalist Guy Verhofstadt, when asked about a potential US-UK trade deal, said: “It is a fantasy – access to the internal market means you are a member of the internal market.
- “You will have to live up to the rules of the internal market, and you cannot strike trade deals with any other party.”
- The Securities and Exchange Commission (SEC) has issued a press release cautioning market participants that offer “Initial Coin Offerings” or “Token Sales” that these “virtual” organizations are subject to the requirements of federal securities laws. So what does this mean for Bitcoin and other altcoins that were primarily operated inside U.S. jurisdiction?
- “The Report confirms that issuers of distributed ledger or blockchain technology-based securities must register offers and sales of such securities unless a valid exemption applies. Those participating in unregistered offerings also may be liable for violations of the securities laws,” the report said.
- So what does this mean for you the investor into these altcoins?
- Firstly, it means your personal right to participate in free markets of ICOs was just shat on. Secondly, it conveys that several dozen blockchain projects that raise capital through the blockchain will probably move out of the USA because of the SEC ruling on compliance with federal securities effectively outsourcing cryptocurrency jobs overseas.
- Lastly, if you now surpass over $1 billion in net worth, you will have to register the tokens as securities; if you don’t you “may be liable for violations of the securities laws. The purpose of the registration “is to ensure that investors are sold investments that include all the proper disclosures and are subject to regulatory scrutiny for investors’ protection.”
- , before once again rising fractionally to 63.7% in Q2 of 2017 from 63.6% in the previous quarter, just 1% from the all time lows in the series history going back to the mid 1960s.
- the youngest age group, those 35 and younger, the Millennials, who over the past decade have seen their homeownership decline steadily
- homeownership rate for Millennials has declined from 43.6% in June 2004 to 35.3% in the latest quarter, and just shy of the lowest rate reported by the Census Bureau going back nearly a quarter century.
- So if not owning, what are America’s young adults doing? According to separate data from Goldman, the share of 18-34 year olds living with their parents is effectively at all time highs.
- A huge upside surprise for durable goods orders (+6.5% MoM vs +3.9% MoM)… This was the biggest surge in DurGoods since July 2014’s record Boeing order also screwed with the data…
- Excluding transportation, new orders increased 0.2 percent. , Core Durable Goods Orders disappointed (+0.2% vs +0.4% exp) and Capital Goods New Orders Nondefense Ex Aircraft & Parts fell 0.1% – the biggest drop since Dec 2016.
- Let’s just hope Boeing can sell a few more planes in July
- Do you know Seth Klarman?
- Klarman is founder of Baupost Group and is widely considered to be one of the greatest value investors in history. In 30+ years from 1982 to 2015, he only had three losing years, and is believed to have averaged returns of 16%.
- Bear in mind, he did this while keeping 30%-50% in cash at all times.
- Put simply, Klarmen’s returns on invested capital are simply astonishing. To be able to churn out those types of returns while being that risk-averse borders on the impossible.
- Which is why when Seth Klarmen and his team warns of a potential Crash, you need to listen.
In the Baupost Q2 Letter, Mooney estimates that investments linked to volatility “likely runs in the hundreds of billions of dollars,” a fact that could propel a market crash once the snowball starts running down the hill. “Any spike in equity markets realized volatility, even to historical average levels, has the potential to drive a significant amount of equity selling (much of it automated),” which would create a self-fulfilling feedback loop that only builds upon itself.
- The markets had a similar experience with automated trading programs in 1987. It wasn’t pretty.
- The Federal Reserve signaled it intends to kick off the reduction in its $4.5 trillion balance sheet in September
- A looming deadline for raising the government’s debt ceiling could end up complicating the Fed’s plans if it significantly disrupts financial markets, particularly for U.S. Treasury securities
- “September is the most likely outcome” for the launch of the balance-sheet drawdown, said Lou Crandall, chief economist at Wrightson ICAP LLC in Jersey City, New Jersey. “But I can’t rule out the idea that they would wait until November if the debt ceiling really looks messy.”
- Following news of the arrest and booking of Debbie Wasserman Schultz’s top IT staffer which followed a report on Monday that destroyed computer equipment was recovered from a home owned by Imran and his wife – the Daily Caller‘s Luke Rosiak is out with another bombshell; Imran Awan wired $283,000 to Pakistan before attempting to flee the country to join his wife (who left the country with $12,000 cash) – hours after the Daily Caller reported Awan was under investigation.
- Debbie, Debbie, Debbie
- Although Debbie Wasserman-Schultz is now trying to distance herself – claiming “Mr. Awan was a “part-time” employee whose serviced had been terminated,” DWS refused to fire him after Awan was barred from accessing house computer equipment – instead changing his title and allowing him to continue to access House property.
Wasserman Schultz lashed out at investigators and changed Awan’s title to “adviser” instead of firing him after House authorities banned him from the network. –Daily Caller
- One month after the EU’s executive Commission launched legal cases against Poland, Hungary and the Czech Republic for “defaulting on their legal obligations” by refusing to comply with the EU’s refugee quotas (i.e., accept migrants), on Wednesday the three Central European nations suffered another blow after Brussels mounted a legal fightback to force them to comply with EU refugee quotas
- Less than a week after C.I.A. chief Mike Pompeo suggested that regime change in North Korea would be a good thing for the Trump administration, the East Asian country said Tuesday it was ready and willing to strike the U.S. with a “nuclear hammer” if that proves to be the Trump team’s agenda.
- North Korea’s test of an intercontinental ballistic missile is a “game changer” and heightens the risk that nation will be able to hit the United States sooner than expected, said Army Gen. Vincent Brooks, the commander of U.S. Forces Korea.c
- . “Nearly weekly tests becoming the new normal. In the past year alone Kim Jong Un has tested 28 missiles, more than his father and his grandfather during their entire reign combined.
- The US-led coalition will reclaim some equipment it provided to the Shohada Al Quartyan fighters that recently defected, Operation Inherent Resolve spokesperson Col. Ryan Dillon said in a briefing on Thursday.
- A long overdue concession by the Pentagon to the Russian-Syrian-Iranian camp in an attempt to save its illegal southern Syrian base that Pentagon has told US-trained Syrian rebel groups in southern Syria they must either abandon the fight against the Syrian military, or the joint US-rebel base in Syria’s al-Tanf
- Russian President Vladimir Putin has signed a federal law on the ratification of the protocol and agreement on the establishment of Syrian Army Air Force for a period of 49 years,
- The protocol includes the Khmeimim base, which was handed over to the Russians on 26 August 2015, and the treaty between Russia and Syria that was signed on January 18, 2017 in Damascus.
- the Trump administration appears set to withdraw US troops from Syria in the not too distant future, as hinted by the recent decision to reverse the Obama-era decision to stop arming “moderate rebels” fighting the Assad regime,