Factory orders did way better than the Econoday consensus estimate of -1.9% but that was against a revision that took July from +4.4% to +3.6%. The good news pretty much stops there.
The headline, at a monthly zero percent, is flat and so are the indications from the bulk of the August durable goods report. Excluding transportation, orders slipped 0.4 percent. This reading excludes a 22 percent downswing in civilian aircraft orders that is offset in part, however, by a solid 0.7 percent gain for vehicle orders. Readings on core capital goods (nondefense excluding aircraft) are mixed with orders up 0.6 percent, which points to shipment strength ahead, but current shipments are down -0.4 to extend a long string of declines going back to May. The weakness here in shipments is a negative for business investment in the GDP report.
Aside from vehicles and a strong gain for defense capital goods, good news is hard to find in today’s report. Total shipments are down 0.4 percent following no change in July while unfilled orders, which last posted a gain in April, fell 0.1 percent. Inventories did fall, down 0.1 percent, but not enough to keep the inventory-to-shipments ratio from rising to a less lean 1.66 from July’s 1.65.
Another negative in the report is a downward revision to July where the gain in total orders is shaved 8 tenths to 3.6 percent. But July was still a very strong month and the August results, though flat, are better than expected. Still, the data point to more of the same for the factory sector, a flat trajectory reflecting weakness in global demand and specific weakness in business investment.
Except for continual nonsense about lean inventories, that was a nicely balanced report by Econoday for a change.
A decision by the U.S. Securities and Exchange Commission may bring European Union banks a step closer to avoiding billions of dollars of capital charges on their trades in derivatives and other securities.
Former US Treasury Secretary Larry Summers says the unrelenting rise in the proportion of men without work since the 1970s will continue and by 2050 he estimates that around one-third of all men in the United States will be without work.
FRANKFURT, Germany (AP) — Carmakers are finding the Paris auto show, held in a city whose mayor wants to ban diesels to reduce pollution, to be a fine place to show off new zero-emission electric vehicles.
Officials from the Organization of the Petroleum Countries plan to discuss Wednesday a proposal that would cut 350 million barrels of the cartel's production spread out over one year--almost 1 million barrels a day, according to people who have seen the proposal.
Late last Friday, we reported that in a troubling development for all Americans, Barack Obama sided with Saudi Arabia when he vetoed the Justice Against Sponsors of Terrorism Act , better known as the "Sept 11" bill, allowing Americans to sue Saudi Arabia over its involvement in terrorism on US soil, passed previously in Congress, despite clear signs that the veto may be rejected by both the Senate and the House.
Moments ago, that is precisely what happened, when the Senate voted overwhelmingly 97 to 1, to override President Obama’s veto of a bill letting the victims of the 9/11 attacks sue Saudi Arabia, striking a blow to the president on foreign policy weeks before he leaves office. The vote marks the first time the Senate has mustered enough votes to overrule Obama’s veto pen.
Democratic Leader Harry Reid was the sole NO vote.
As the Hill reported, not a single Democrat came to the Senate floor before the vote to argue in favor of Obama’s position.
Obama has never had a veto overridden by Congress.
Lawmakers don’t want to be seen as soft on punishing terrorist sponsors a few weeks before the election, at a time when voters are increasingly worried about radical Islamic terrorism in the wake of recent attacks in Manhattan, Minnesota and Orlando, Fla. Oddly enough, Obama had no problem with those particular optics.
The House will take up the matter later on Wednesday, and Speaker Paul Ryan told reporters last week that he expects there be to enough votes for an override.
As a reminder, the legislation, sponsored by Senate Republican Whip John Cornyn (Texas) and Sen. Chuck Schumer (D-N.Y.), the third-ranking member of the Democratic leadership, would create an exception in the Foreign Sovereign Immunities Act to allow the victims of terrorism to sue foreign sponsors of attacks on U.S. soil.
It was crafted primarily at the urging of the families of victims of the Sept. 11, 2001, attacks who want to sue Saudi Arabian officials found to have links with the hijackers who flew planes into the World Trade Center and Pentagon. It
The Commerce Department reported [on Monday] that sales of newly built homes posted a seasonally adjusted month to month decline of 7.6% to an annualized rate of 609,000. This was near the consensus guess of economists of 602,000 according to the Wall Street Journal. In terms of the game of pin the tail on the donkey-economists, it was a non-event.
The Commerce Department also reported that the August headline number was up 20.6% year to year. That sounds good until you look at the actual data.
The actual, unmanipulated figures showed a total of 50,000 new homes sold in August, compared with 57,000 in July, a drop of -12.3%. That was much worse than the typical month to month decline in August. Last year the August drop was -4.7% month to month. The average August decline for the prior 10 years was -5.6%. In fact, this was the largest August month to month decline in history, going back to 1963 when the Federal Government began collecting this data.
This August had the advantage of 2 more business days than August 2015 possibly giving the August numbers a boost. New home sales are counted at the time they go under contract. While sales contracts can be signed on weekends in this business, it’s the exception. The numbers were the worst in history, even with that boost. In cases like this, economists usually blame the weather. I guess it was too hot to buy houses. Global warming, yeah, that’s the ticket!
The year to year change gives a different perspective. That was still up 22%, which sounds good until you note that the sales rate remains near the lowest levels in history. At the same time mortgage rates are at the lowest level in history.
The 22% year to year increase compares with an annual rate of change in July of +32.6%. The last time there was a larger year to year increase in July was 1983. That was coming off the 1982 recession low. Before that was 1971. We have to wonder if this July was the blowoff phase of this much ballyhooed “recovery.” If so, it’s all downhill from here.
While the market had 2 more years of modest gains after that move in 1983,
(Left) JPMorgan’s European Headquarters at 25 Bank Street, London Where Technology Executive Gabriel Magee Died on January 27 or January 28, 2014
On September 22, 2016 eight Senate Democrats, including Elizabeth Warren, Bernie Sanders, Jeff Merkley and Sherrod Brown, wrote to the Department of Labor requesting an investigation of the banking behemoth, Wells Fargo, to determine if it violated labor laws. The letter came amidst the public outcry over news that Wells Fargo’s employees had opened as many as 2 million customer accounts without authorization in order to meet stringent sales quotas for cross-selling products. The Senators wrote in the letter:
“…dozens of former and current Wells Fargo employees have come forward to describe the lengths they went to in order to meet the bank’s aggressive sales quotas. When quotas weren’t met, employees faced threats of termination; mandated hours of unpaid overtime; harassment; and other forms of retaliation. For years Wells Fargo employees have described a management culture characterized by ‘mental abuse,’ being forced to work overtime ‘for what felt like after-school detention’ during the week and on weekends, and being ‘severely chastised and embarrassed in front of 60-plus managers.’ ”
Unfortunately, the Senators demonstrate their naiveté about Wall Street’s longstanding and systemic abuse of its workers when they suggest that Wells Fargo has done something uniquely evil to its employees. The Senators write that “Wells Fargo stands out” because it denied overtime pay to its workers dating back as far as 1999.
In reality, cheating low-wage workers out of overtime pay is de rigueur among the biggest banks on Wall Street, as a long series of lawsuits have made clear. As recently as 2014 the serially charged JPMorgan Chase settled a class action lawsuit for $12 million which alleged that its bank tellers and other employees in 12 states were forced to work off the clock for part of their workday with managers actually altering their time cards to reduce JPMorgan’s labor costs. In the same year, Wall Street powerhouse Morgan Stanley settled on the cheap for $4.2 million over allegations it failed to pay its low-wage sales assistants their overtime pay. Eight years earlier, Morgan Stanley …
Whether you think there has been a housing “recovery” or not is a matter of perspective. Sales are indeed up 117% since the 2010 low, but that low was literally the worst level in the history of this data (since 1963) as a percentage of population growth. It was the Great Depression of Housing, the only possible result of the greatest housing bubble since the 1920s, if not in history. While sales have rebounded since that low, the current sales rate has barely recovered to the levels seen at the recession lows of 1991 and 1982. This rebound is little more than a dead cat bounce after 6 years of recovery, and now it may be faltering.
Mainstream economists give the Fed credit for stimulating this “recovery.” But, in fact the Fed has created a Catch 22 with no way out. The only thing the Fed has stimulated is house price inflation while destroying interest income on savings for millions of ordinary Americans, especially former middle class retirees. With mortgage rates pushed down to all time lows, house prices have consequently inflated at a rate that offsets the buyer’s savings in the interest component of the mortgage. Meanwhile American savers have lost not only massive purchasing power, but also have been forced to consume principal. The Fed has not stimulated sales but it has succeeded in transferring wealth away from those who can least afford it to those who least deserve it.
Had mortgage rates stopped falling at higher levels, house price inflation would have been stunted. More of a buyer’s mortgage payment would have been apportioned toward the higher interest component of the payment and less toward inflating the purchase price.
But the Fed got the result it intended. It wanted to inflate prices to save the banks from their stupidity and criminality. Decisions were made at the highest levels of the Fed and the Federal Government to not only let the banks off the hook, but to rescue them. The only way to do that was to forego prosecution of massive criminal wrongdoing, and to engineer price inflation, so that the criminal perpetrators of the fraud that drove the Great Bubble would
Just as the Vietnam War was built on lies, propaganda, PR and rigged statistics (the infamous body counts--civilians killed as "collateral damage" counted as "enemy combatants"), so too is the "recovery" nothing but a pathetic tissue of PR, propaganda and lies. I have demolished the bogus 5.3% "increase" in median household income, the equally bogus "official inflation" body counts, oops I mean statistics, and the bogus unemployment rate:
"I've been reading a lot about a "recovering" economy. It was even trumpeted on Page 1 of The New York Times and Financial Times last week. I don't think it's true.
The percentage of Americans who say they are in the middle or upper-middle class has fallen 10 percentage points, from a 61% average between 2000 and 2008 to 51% today."
Now that is a self-reported number. The reality is much worse: only 20% of American households possess the income and assets that characterize the middle class in financial terms. Granted, someone making $28,000 a year can self-identify as middle class, but if we look at basic metrics of financial security, they're not even close.
BlackBerry has completely outsourced smartphone design and production, a process that Chen had been doing piecemeal since taking over as CEO almost three years ago.
Analysts had been holding their breath for the news after Chen said September was his deadline for making the chronically money-losing device business profitable. BlackBerry’s device business, which it calls "Mobility Solutions," will focus on developing applications and an extra-secure version of Google’s Android operating system that it can license to other companies.
“Our new Mobility Solutions strategy is showing signs of momentum, including our first major device software licensing agreement with a telecom joint venture in Indonesia,” Chen said in a statement.
“Under this strategy, we are focusing on software development, including security and applications. The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital.”
On September 22, Donald Trump reaffirmed his intent to revive the American coal industry – without many details on how to do it. What influences the price and demand for coal? Can Donald Trump influence the forces behind these market drivers?
We nominate these four factors as the most important drivers of coal prices: production and demand for steel, because the coal industry sells and exports metallurgical coal used in steel production; demand for electricity, insofar as much electricity is still generated from coal; Chinese government interference in the steel and metallurgical coal markets, because China is the world's largest steel producer and most of the companies there are state owned; and, lastly, the price of natural gas because coal competes directly with natural gas in the electric generation market. Of course a fifth factor may emerge: Presidential Candidate Donald Trump’s plan (so far unspecified) to make coal king again.
Let’s examine these factors most of which are not within the control of the U.S. President. From 2007 (before the market crash) to the present, steel production in the U.S. and the Rest of the World (outside China) has declined and Chinese production may be topping out as well. The coal industry can’t improve metallurgical coal sales up without a steel industry revival. (See Figure 1.)
Figure 1. Production of Crude Steel (millions of metric tons)
The electricity market has a similar "topping" look to it (and is far more important because electric generators buy over 90% of all U.S. coal production). We see static sales in the U.S. and declining growth elsewhere. (See Figure 2.) Even if renewables, especially wind, were not crowding out coal from the power generation market, sales to the electricity industry would show minimal growth at best. The real problem? Coal can no longer compete with natural gas on a price basis as an electricity generating fuel.
Figure 2. Electricity Generation (TWH)
But the price of fuel is only part of the problem. The costs to build new coal-fired power plants is higher as well. Overall power costs for a new
As recently pointed out by Bloomberg, Greenwich has long been one of the most prosperous communities in America with one out of every $10 in hedge funds in the country being managed there by the most elite funds like Viking Global, AQR and Steven Cohen's Point72.
But these days, as hedge fund returns have suffered and banking bonuses have remained stagnant for years, the trophy items like expensive jewelry and exotic cars are just piling up in luxurious Greenwich showrooms.
The lonely $250,000 S-Class coupe at Mercedes-Benz of Greenwich says it all. For six months, it’s been sitting in the showroom, shimmering in vain.
“We haven’t had anyone come in and look at it,” says Joey Licari, a sales consultant at the dealership, looking over his shoulder at the silver beauty. “I feel like normally they would, maybe a few years ago.”
Ten-carat diamonds that can cost in the six figures collect dust in stores on the main drag.
But exotic cars and jewelry aren't the only items not moving as real estate brokers say that Greenwich mega mansions are sitting on the market for years amid collapsing prices. As head of Starwood Capital Group, Barry Sternlicht, said the rich are being maddeningly frugal "you can’t give away a house in Greenwich." In fact, according to Houlihan Lawrence contracts for homes between $5 million and $5.99 million are down 80%.
Many continue to try to sell their real estate holdings. As of Sept. 14, there were 46 homes at $10 million or more on the market, some that have been lingering since 2014, according to data from Miller Samuel and Douglas Elliman.
Back in the day, “everybody in the world wanted five acres and pillars on their driveways, because that’s what you got when you ‘made it,”’ says Frank Farricker, a principal with Lockwood & Mead Real Estate who’s chairman of the Connecticut Lottery board. “Now, ‘made it’ means on the waterfront — on a small lot with a brand-spanking new house.”
On example of the tanking Greenwich real estate market is the following 19,773-square-foot mansion once owned by Republican presidential candidate Donald…
With Saudi devaluation bets soaring, Chinese money-market rates popping, 2 debates and an election looming, and the most systemically dangerous bank in the world flashes the reddest of red warning signs, HSBC's Murray Gunn's conclusion bears paying attention to. Between wave-trending signals and disturbing technical trading patterns, Gunn warns of "ominous shades of 1987" for the markets.
The Dow Jones Industrials index has turned lower from a Head & Shoulders neckline re-test. A similar pattern occurred at this, often bearish, time of the ...
A gang of 27 EU nations hit the UK with a parade of impossible demands. All the countries demand the UK grant free movement of people, but that is why the UK left.
In addition, Spain wants joint sovereignty over Gibraltar, Malta demands the UK get an “inferior” deal, the Czech Republic says “Four freedoms or no freedoms”, and Lithuania says the UK should “pay if they stay.”
For its part, the gang of 27 believe the UK has an impossible demand on immigration control that they cannot accept. If neither side gives, and that is increasingly likely, a hard Brexit looms, very hard.
Gang of 27 Demands
Four freedoms or no freedoms. The main sticking point is immigratio...
In early 2009, the seven largest publicly traded college operators were worth a combined $51 billion. Today, they’ve been all but wiped out.
When Barack Obama took office, America’s seven largest publicly traded college operators were worth a combined $51 billion, with more than 815,000 students enrolled at campuses spread across the country. The schools were flooded with with people seeking shelter from the recession, returning to school to pick up new skills.
Almost eight years later, the industry has been decimated. The seven largest listed operators are worth just over $6 billion, and the most valuable co...
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I was so pleased yesterday by the announcement that I have joined the Research team at GoldCore as it meant that I could finally start talking about it and was back in a role that lets me indulge in my passion by researching and geeking out on all things gold, silver and money.
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Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer. One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."
Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.
Genetic components are the DNA sequences that are 'inherited.' Some of these genes are stronger than others in their expression (e.g., eye color). Yet, some genes turn on or off due to external factors (environmental), and it is und...
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