Is DNC Chair Tom Perez Trying “Broken Arrow” 2018?…


Aside from the common vernacular of ‘broken arrow‘ referencing a loss of a nuclear weapon it also means:

“a code phrase that a ground unit is facing imminent destruction from enemy attack and all available air forces within range are to provide air support immediately.”

In essence, with enemy completely overwhelming a position – a military commander calls in direct fire upon themselves in a last-ditch effort to at least retain some of their own forces in the aftermath.

For the sake of this discussion do not consider the reference ‘federal politicians’ (ie. DC congress and Senate); but rather consider the term “broken arrow” a metaphor for the totality of the past eight years and the collapse of the Democrat political apparatus in state House seats and state Senate seats.

Currently:

  • State House Majority Control: 38 states Republican / 12 states Democrat
  • State Senate Majority Control: 37 states Republican / 17 states Democrat / 1 state tied.
  • State Governors: 34 Republican / 15 Democrat / 1 Independent

If you put a blue marble on a table for each of the Democrat politicians in state office and a red marble on the table for each of the Republican politicians in state office the table would be roughly 65% red marbles and 35% blue marbles.

If you are DNC Chairman Tom Perez the challenge is daunting.  However, one rather extreme strategy would be to call in a “broken arrow” sledgehammer on the entire table.  If your attack smashed a quarter of the total marbles, the majority of the marbles smashed would be red.  Yes you would lose some blue marbles that way but your losses would be less than your opponent simply because you have less marbles on the table.

Still with me?

OK.  Now, think of that sledgehammer as “Sexual Harassment Claims”.

See the strategy?

Your political enemy has twice the exposure to risk.  Hollywood starts the narrative, and the Media can be counted upon to assist the strategy by over emphasizing the scale of the enemy losses and downplaying the scale of the friendly losses.

If you started with a total of 1,000 marbles (650 red, 350 blue) and lost 25% in the strike, the end result would be 250 casualties (163 red, 87 blue).  You would have killed off twice as many state/national republicans as you would state/national democrats.

It’s an extreme strategy; it’s a desperate strategy; but it’s a strategy nonetheless.    This is DNC Chairman Tom Perez we are talking about.  Former head of the DOJ Civil Rights Division (CRS); before becoming Obama’s head of the Department of Labor.

Perez is a life-long fellow Alinsky traveler inside the cause; and was ‘installed’ as DNC Chair the same way Hillary Clinton was installed as candidate in 2016.

Democrats, the institutional system that is constructed of people, are pretty good political strategists but their modern Achilles heel is their lack of patience.  The system supporting the ideological hand of Perez is demanding immediacy – they’re desperate.

The 2010 (“shellacking” of Obama) through 2014 gains were all Tea Party.  The 2016 gains, including the presidency, was MAGA; the evolution of the exact same people.  The Trump MAGA Team in 2016/2017 was the Tea Party Team in 2009/2010.  The commonality was/is ‘cold anger‘.  Strategic. Purposeful. Resolute. Deliberate. Long-term and sequential.

Current 2017 Democrat anger is hot.  It’s reactionary; easily provoked to act to spite itself. That anger is fueling stupid…. It thrashes. Look around, it’s childish.

Play stupid games, win stupid prizes.

Try stupid strategy, win stupid consequences.

Roy Moore Campaign Officials Hold Press Conference (Video)…


Alabama campaign officials who support Roy Moore held a press conference yesterday to outline the reason for their continued support.  Additionally, several officials confronted and deconstructed the accusations.

The audio is a little sketchy in the beginning:

The Hidden Risk of Broker/Clearer


QUESTION: Dear Mr. Armstrong, Thank you for your work in “educating” us in your “University of the Conscious Investor”! My question relates to your “Trading a Vertical Market” report. I am slowly digesting this report which is truly fascinating and a must read for any rational minded investor. My experience tells me (and you have reaffirmed this within your report) that being able to trade correctly for the market is critical. In analyzing the correct actions we must take I have reached the conclusion that we must also investigate deeply the trading company we use and how any wild ride will impact their ability to actually fund the successful trades we have managed to get into and out of. I recently was issued new T&C’s for my accounts to accept and that makes for scary reading in the light of any major reset or mammoth gap or moves we anticipate. How would you recommend we evaluate the companies actually holding the bag to be able to pay up at the end of the day? This appears to me to be a most crucial question in the light of what Socrates is pointing out.

Be Well,

ANSWER: Yes, you are absolutely correct. Your broker/clearer is an additional risk.

 The kind of market conditions we are about to face will force questions beyond extreme volatility, no bids and the gapping of price and trade. What Traders must realize is that these extreme price actions themselves trigger increased margins, which again could trigger a liquidity crisis. Under such panic moves, prices can gap ‘without’ a trade and is worth remembering people sell what they can not what they should. This forces other markets to move just to raise cash. If market movements are violent everyone is pulled into the mix.

This is when you have to hope that every one of your fellow account owners (under the broker/clearer you are using) is liquid enough to honor margin requirements. This type of information is rarely going to be available to all and so makes many remain vulnerable.

Just to make you aware, it is possible that your money is vulnerable even if you do not have an open position and is just sitting with your clearer if they were to fail.

A lot of people lost money in the MF Global Scandal.

 

The Political Crisis in Germany Changes the Game


Merkel faces the worst crisis of her career and many behind the curtain are starting to wonder if she will even survive. The German Federal President Steinmeier could not actually order new elections immediately. The procedure in this regard is quite complicated in Germany. The earliest possible alternative would be to hold new elections come the spring of 2018. It is likely that the AFD is likely to gather even greater support from new elections. Nonetheless, the CDU will continue to support Merkel at least right now. However, the CDU has been severely weakened by the election and if we do not see new elections until the spring, there is a distinct possibility that Merkel’s support even within the CDU could collapse if they see the AfD will win even greater support.

The head of the Federation of German Industries (BDI), Dieter Kempf,  has chastised the political leaders calling on the SPD, FDP and Greens to form a coalition. The price that the SPD will demand is that Merkel leaves before they would consider any compromise. There is just bad blood now between the SPD and CDU. Of course, this makes it even more likely we see and even more difficult Brexit. The practical crisis is the fact that Merkel must attend to domestic issues and will not truly have the time or authority to assume a leadership role in Brussels.

This turmoil in German politics is actually shifting the stage to Macron. The uncertainty in Germany may be opening the door for Macron to reform the EU and the Eurozone pushing Germany to second place. The political fortunes for the EU may be far more uncertain than many suspects.

From a market perspective, political uncertainty in Europe still creates uncertainty in markets rather that confidence.

MAGA Brilliant – Multidimensional Economic Policy – Trade Shift to Durables…


Go through the archives and you’ll note a strategy unfolding that few, including us, could fully conceptualize when it first appeared.  Way back when candidate Trump first began to put his economic plans into platform outlines the subtle signature was there, but few were paying attention.

In order to reverse three decades of middle-class economic erosion, there were indicators that Trump’s strategy was a radical change in approach.  In essence the strategy was to split the economic policy into two areas and sequence the policy: highly-consumable goods (first) and durable goods (second).

Both product sectors have historically been viewed and approached by economic policy makers using a single financial strategy.  That singular approach gave rise to Wall Street benefiting and Main Street suffering.  Investment-class gained; middle-class suffered.

Trump outlined an approach –albeit vaguely– that was multidimensional.

His policy would first target multinational corporations, using the U.S. Treasury (Mnuchin) to weaken their grip and influence; simultaneously, he would use energy policy to drive down domestic prices in highly-consumable products (fuel, food, energy sector).  These sectors are not measured in fed inflation indexes; however, if lowered, these facets of consumer spending can also increase the amount of disposable income available for workers.

In essence, expand the economy by lowering the aggregate cost of living for the middle-class who live paycheck-to-paycheck.  Use fiscal policy (and trade policy), to entice domestic investment and create jobs; and ultimately put upward pressure on wages.

That’s where we are now.

The second aspect of Trump economic policy is geared toward ‘durable goods’.  That’s where the trade imbalance plays a larger role in the strategy.

As the economy expands, Americans can now afford rises in the prices of durable goods.  However, as with all manufacturing systems -geared toward retaining market share inside a consumer economy (ie. the U.S. market)- the foreign creators will first seek to retain competitive pricing structure by making efficiencies within their own business models.

When foreign manufacturers entering a phase of cost-cutting analysis (note Team Trump just left Asia) you immediately hit them with stronger forecasted trade rules on their products.  The manufacturers financial analysis then has to contain the possibility of new rules.  That’s where Commerce Secretary Wilbur Ross and U.S. Trade Representative Robert Lighthizer come in:

(Story Link)

On Oct. 5, the ITC [International Trade Commission] voted unanimously in favor of Whirlpool, which brought a complaint forward accusing Samsung and LG Electronics, its South Korean competitors, of flooding U.S. markets with cheap washing machines and pricing out domestic manufacturers. While the ITC didn’t say material harm was coming from South Korea in particular, Whirlpool alleged the country’s manufacturers shifted production into other countries (Thailand and Vietnam) in order to avoid U.S. anti-dumping tariffs imposed in previous years.

The ITC’s recommendations will be sent to President Donald Trump, who will have two months to make a final decision.

This second phase is where the two economic engines: Wall Street and Main Street; begin to come into parity again.   The FED does measure the cost of durable goods in their inflation index.  Rises in durable goods are recorded in inflation indexes and fiscal policy (interest rates) is influenced accordingly.

Trump’s phase-one befuddled the FED who have been perplexed over inflation being virtually non existent.  Most of the reason for this disconnect has been the downward price pressure on (non-measured) highly-consumable goods; and static prices on (measured) durable goods.  The FED can see the economy expanding, but they cannot, or at least couldn’t until now, reconcile the lack of inflation.

Wages are growing, albeit modestly at first – but now gaining speed, as a result of economic expansion and increased employment.  This wage growth, in combination with keeping downward pressure on high-consumable prices, allows Trump to begin a series of aggressive trade policies that will slowly raise durable good prices.

The trade policy, tightly executed by Trump, Mnuchin, Ross and Lighthizer, will put increased pressure on manufacturers to make products in the U.S.  In turn this puts further demand on U.S. workers; which, in turn drives up the wages to afford the prices of durable goods as they increase.

Simultaneously, it must be remembered that every dollar removed from imports actually increases the GDP.  The value of all imported goods is deducted from the combined value of all goods and services we produce.   If we drop $1 billion in imports on Washing Machines, and simultaneously manufacture $1 billion on Washing Machines in the U.S., the U.S. GDP gains $2 billion in value.  The U.S. economy actually expands by more than $2 billion because the attached manufacturing wages are also inside the U.S.

This multi-prong approach is one of the reasons why it just doesn’t seem to be part of the strategy to keep the U.S. inside NAFTA as it currently is constructed.  Perhaps, just perhaps, the NAFTA exercise is more optical than actual.  Perhaps, it’s more about the outside world seeing the U.S. trade position as executed, than actually negotiating….

Media Ignores Key Alabama Witness Reports That Refute Roy Moore Accuser…


On top of the original story told by Gloria Allred falling apart; and on top of Allred refusing to produce the yearbook from the accuser that she highlighted as evidence; the Alabama campaign of Roy Moore has been contacted by several key witnesses who refute the story described by Gloria Allred’s client and media accuser Beverly Nelson.

Interestingly, the witnesses who have direct and specific knowledge of the events Mrs. Nelson described in 1977 already told the media her story didn’t make sense and provided specific examples that refute the claims of Mrs. Nelson.  However, after waiting to see their accounts told by the media, and seeing nothing, the witnesses realized the media was hiding them.

GADSDEN, Ala. – On Monday evening, the Moore Campaign unveiled statements from key witnesses that completely bust the story of Beverly Nelson and Gloria Allred and further reveal an unconscionable bias on the part of state and national press to hide the truth from Alabama voters who will undoubtedly see through the “fake news” and elect Judge Moore for the man that they have always known him to be.

[…]  These witnesses have shared their testimony with multiple news outlets. The outlets have failed to report.

Rhonda Ledbetter, a retired public school teacher who is currently the senior choir director at a Baptist church and teaches children at a local, church-sponsored day care center, was a waitress at Olde Hickory House for almost three years from 1977-1979. She was a college student at Jacksonville State University at the time and worked varying shifts at different times of day, multiple days a week during the time of her employment.

She said in a statement:

“When I heard Beverly Nelson’s story, there were several details that were different from what I remember. I was nervous at coming forward because of all the attention this story has gotten, but as a moral and ethical person I had to speak up about what I know to be true.

I was a waitress at Olde Hickory for almost three years from 1977-1979, and I never saw Roy Moore come in to the restaurant. Not one time. And I would have noticed because most of our customers weren’t wearing suits, especially not at night. Many customers worked at Goodyear next door and would stop in on their way to and from work, and I don’t remember anyone from the courthouse coming in at all. That just wasn’t our crowd.

“A few things stuck out to me. First, Nelson said she was 15 years old when she started working there but you had to be 16. I don’t remember her from my time there, and I don’t remember any 15-year-olds working there at all.

“Second, Nelson said the restaurant closed at 10 p.m. but I know the earliest it closed was 11, though I believe it was midnight. I’m certain of that because Goodyear employees came in to eat after their shift ended at 10:00 p.m., so there’s no way we would have closed at that time.

“Third, the area wasn’t dark and isolated as she described. Rather, the building was right off the busy four-lane highway and people and cars were always around. The restaurant had a wrap-around porch, like the ones at Cracker Barrel restaurants, and there were lights all around the sides of the building. So it wasn’t dark and anyone in the parking lot was visible from the road.

“Fourth, the dumpsters were to the side of the building, not around back and there sure wasn’t room to park in between the building and the dumpsters. People from the kitchen would take trash out of the side door and throw it right into the dumpsters. We were always told to park on the side of the building, because there just wasn’t much room behind it. I don’t remember there being an exit from the back of the parking lot, there would barely have been enough room to turn a car around.

“I came forward because from what I’ve seen, the media is only interested in reporting one side of this story. In fact, Dixon Hayes from WRBC in Birmingham asked for former employees to contact him but never responded when I told him I never saw Roy Moore come into Olde Hickory House during the three years I worked for. Two other news outlets in the state asked to interview me and I agreed, but neither one has aired my interview and I have to wonder why they don’t think the people of Alabama deserve to hear anything that counteracts the accusations against Judge Moore.

It’s not for me to say whether or not something happened, I can only tell the truth about factual details that I know for sure. I think all Alabamians deserve to have all of the facts so they can decide for themselves what the truth is. Despite what the national media and people in DC might say, Alabama voters are intelligent and have common sense. We don’t need anyone to tell us how to vote or to explain to us what really happened. We will make that decision and I just wanted to do my part in sharing the truth on some of these important facts. I, like all Alabama voters, want any and all information that can shed light on the truth.”

Johnny Belyeu, Sr. is a former police officer with over two decades of experience with the Etowah County Sheriff’s Department and the Gadsden Police Department. He said in a statement:

“I was an officer with the Etowah County Sheriff’s Department in the 1970s which means I worked in the courthouse and knew who Roy Moore was since he was the Deputy District Attorney at the time. I was a regular customer at Olde Hickory House, and I never once saw Judge Moore come in there. If he had I would have immediately recognized him. I also never met Beverly Nelson during any of the many times I frequented the restaurant, and I can’t say that she even worked there.”

Renee Schivera of Huntsville, Alabama stated:

“I was a waitress at the Olde Hickory House during the summer of 1977, before my senior year of high school. When I heard Beverly Nelson’s story the first thing that stuck out to me was that I don’t remember Roy Moore ever coming into the restaurant. I also don’t remember her working there.

The other thing that struck me as odd is that from my best recollection, the dumpsters were to the side of the building. I just know they were visible from the road, and not back behind the building. But the main thing is that if someone came in almost every night we knew who they were, and I never saw Roy Moore there. As a Christian woman, I wouldn’t lie for anyone and I am only sharing what I know because it’s the truth.”

(SOURCE)

Signed in December?  Two inks? Two different hand writings?  A signature lifted from divorce documents?…  Eye witnesses refuting the accusations….

It is clear from a simple review of the inscription that two inks were used, and two different types of handwriting appear present.

Providing further evidence toward Moore’s defense, he notes the “DA” following the signature are specifically the same as the divorce documents he signed for Mrs. Nelson in 1999 (see below):

The “D.A.” does not stand for District Attorney, it stands for “Delbra Adams”, Judge Moore’s former assistant who started working for him in 1987, ten years after the “DA” which appears in Mrs. Nelson’s yearbook.

The evidence showing Beverly Nelson and Gloria Allred manufactured the yearbook as support for a thinly veiled political hit and scurrilous claim seems overwhelming and presumably that’s why she is refusing to allow independent inspection.

In addition to being a dubious lawyer with a career containing several fraudulent claims against republican political opposition (ex. Herman Cain and Donald Trump), Gloria Allred is also a DNC delegate political activist.

Embattled Angela Merkel Indicates New Election Preferred Over Minority Governing…


Stunningly even Chancellor Merkel herself admits her immigration intransigence is the leading reason for her inability to form a coalition government.  Yet she is so committed to the ideology of ‘open borders‘ she will tender no compromise.

In an effort to leverage political blackmail against her opposition Merkel prefers the route of another election rather than trying to govern from the minority position.

BERLIN (Reuters) – Chancellor Angela Merkel said she would prefer a new election to ruling with a minority after talks on forming a three-way coalition failed overnight, but Germany’s president told parties they owed it to voters to try to form a government.

The major obstacle to a three-way deal was immigration, according to Merkel, who was forced into negotiations after bleeding support in the Sept. 24 election to the far right in a backlash at her 2015 decision to let in over 1 million migrants.

The failure of exploratory coalition talks involving her conservative bloc, the liberal pro-business Free Democrats (FDP) and environmentalist Greens raises the prospect of a new election and casts doubt about her future after 12 years in power. (read more)

It really is remarkable the level of entrenched ideology amid those who carry a far-left world view.  The position of Chancellor Merkel is reflective of visible authoritarianism within a democratic assembly of government.  There is apparently no limit to what Merkel is willing to do in order to retain her individual political outlook without concession.

Not surprisingly, the media fail to call out this representative reality; behavior which is, ironically, exactly what media falsely accuse President Trump of doing.

Merkel Vows to Run Again


After the failure to form a new government, Chancellor Angela Merkel has made it clear she has no intention of withdrawing from the race. New elections in Germany are looking ever more likely. Merkel appeared on TV on ZDF and said that she had not thought of resigning. Federal President Frank-Walter Steinmeier urged the parties to make a new attempt to form a government. The SPD, however, reiterated it will not agree to a grand coalition.

The Approaching Famine


The most serious forecast that we see from our computer models has been a rise in agricultural prices caused by Global Cooling – not Global Warming. Crops cannot grow without the sun and water. Historically, when the weather turns cold, the crops fail.

There is no question that food prices will rise during periods of war when crops cannot be planted and armies require food on a priority allotment.

However, Mother Nature sticks her finger into the pot to stir things up. The famine cycle is also an 8.6-year frequency, but the volatility aspect comes in units of 12 rather than 6.

   

Our database on wheat from 1259 forward (excluding our data on the Roman Empire grain prices), reveals that there is a serious risk of famine from 2020 onward. It appears that we may very well enter a 12-year rally into the year 2032. Our Bifurcation Models are reflecting also a gap in time between 2020 and 2031 suggesting a trend appears to last for that period of time.

The downside of taxation, and particularly inheritance taxes, has driven farmers to sell their land to conglomerates just to pay the inheritance taxes. This has resulted in genetically altering crops to increase yield. While genetically altered crops do not really appear to present a major health concern as many seem to argue, the real danger is the fact that during the past 100 years, 94% of the world’s edible seed varieties have vanished.

The downside of socialism which has attacked the rich, we have sacrificed the historical model in our food supply for corporate decision making that bribes politicians handing them their needed money to remain in office with each election. The consequence of this corruption has been the concentration of our food supply into an ever-shrinking basket of diversity. Today, 75% of the world’s food comes from only 12 plants and 5 animal species (see source). This lack of biodiversity has seriously increased this risk of widespread crop disease, and throw in the climate change turning colder, corporate decisions are not the way to protect society. Corporate boards are typically dominated by lawyers and accountants. They are not scientists nor do they even make proper decisions for investment or currency hedging. Corporations will never be able to cope with a sudden change and then make decisions that will impact the world. Major companies, such as Monsanto, could find themselves in control of the fate of human existence with the decisions being made by lawyers and accountants fixated on their bottom-line.

The period ahead, 2020-2032, appears to offer something much more different. While politicians keep pushing Global Warming because they can tax emissions, the risk of a monumental human disaster lies in the opposite direction.

The entire theory of Ice Ages emerged after the discovery in 1772 of wooly rhinos and mammoths were frozen in ice with plants still in their stomachs. Suddenly, science woke up and came to the shocking realization that climate can change drastically with no notice.

We have the technology today to drow food inside without even soil. This is something one should consider to put in your basement as 2020 approaches on the horizon.

 

Germany Moving Toward Political Crisis


Chancellor Angela Merkel said on Monday her efforts to form a three-way coalition government had failed. Merkel only received 32.5% of the vote, which is probably the lowest vote of any major world leader. The FDP pulled out of negotiations thrusting Germany into a political crisis and ever closer to a possible new election.

Meanwhile, German hoard of cash is escalating and the cities debt burdens are exploding in Germany. The entire game4 was to hide the debt crisis in Germany until after the elections. With the failure to form a government, new elections are appearing likely extending this Year from Political Hell.

This is becoming the political crisis that just will not go away. Politics around the world remain in turmoil and as our computer had forecast, this would contribute to the collapse in public confidence. The fate of the Euro hangs in the balance.