- Irreversible Damage – The U.S. Economy Cannot Be Repaired
Submitted by Brandon Smith via Alt-Market.com,
As I outlined in my article 'The False Economic Narrative Will Die In 2017', the mainstream media has been carefully crafting the propaganda meme that the Trump administration is inheriting a global economy in “ascension,” when in fact, the opposite is true. Trump enters office at a time of longstanding decline and will likely witness severe and accelerated decline over the course of the next year. The signs are already present, and this fits exactly with the basis for my prediction of the Trump election win – conservative movements are indeed being set up as scapegoats for a global economic crisis that international financiers actually created.
Plus, it doesn’t help that Trump keeps boasting about the farcical Dow hitting record highs after his entry into the White House. Talk about the perfect setup…
With the speed at which Trump is issuing executive orders, my concern is that people’s heads will be spinning so fast they will start to assume an appearance of economic progress. Here is the issue — some problems simply cannot be fixed, at least not in a top down fashion. Some disasters cannot be prevented. Sometimes, a crisis has to run its course before a nation or society or economy can return to stability. This is invariably true of the underlying crisis within the U.S. economy.
It is imperative that liberty activists and conservatives avoid false hope in fiscal recovery and remain vigilant and prepared for a breakdown within the system. Despite the sudden political sea change with Trump and the Republican party in majority control of the D.C. apparatus, there is nothing that can be done through government to ease fiscal tensions at this time. Here are some of the primary reasons why:
Government Does Not Create Wealth
Government is a wealth-devouring machine. The bigger the government, the more adept it is at snatching capital and misallocating it. Such a system is inherently unequipped to repair an economy in a stagflationary spiral.
I’m hearing a whole lot of talk lately on all the jobs that will be created through Trump’s infrastructure spending plans, which reminds me of the desperation at the onset of the Great Depression and the efforts by Herbert Hoover to reignite the U.S. economy through a series of public works programs. Reality does not support a successful outcome for this endeavor.
First off, Trump’s ideas for infrastructure spending to kick start a U.S. recovery are not new. The Obama administration and Congress passed the largest transportation spending bill in more than a decade in 2015 and pushed for a similar strategy to what is now being suggested by Trump. I should point out though that like Herbert Hoover, Obama’s efforts in this area were essentially fruitless. Obama was the first president since Hoover to see “official” annual U.S. GDP growth drop below 3 percent for the entirety of his presidency, with GDP in 2016 dropping to a dismal 1.6 percent.
Though projects like the Hoover Dam were epic in scope and electrifying to the public imagination during the Depression, they did little to fuel the overall long-term prospects of the American economy. This is because government is incapable of creating wealth; it can only steal wealth from the citizenry through taxation to pay debts conjured out of thin air, or, it can strike a devil’s bargain with central banks to print its way to fake prosperity.
Some might argue that Trump is more likely to redirect funds from poorly conceived Obama-era programs instead of increasing taxes or printing, but this does not change the bigger picture. Redirected funds are still taxpayer funds, and those funds would be far better spent if they were returned to taxpayers rather than wasted in a vain effort to increase GDP by a percentage point. Beyond this, the number of jobs generated through the process will be a drop in the bucket compared to the 100 million plus people no longer employed within the U.S. at this time.
Bottom line? Though new roads and a wall on the southern border are winners for many conservatives, infrastructure spending is a non-solution in preventing a long-term fiscal disaster.
Interdependency Is Hard To Break
Another prospect for raising funds to pay for job generating public works projects is the use of tariffs on foreign imports. Specifically, imports of goods from countries which have maintained unfair trade advantages through global agreements like NAFTA, CAFTA or the China Trade Bill. This is obviously a practical concept and it was always the intention of the founding father post-revolution for government to generate most of its funding through taxation of foreign imports and interstate commerce, rather than taxation of the hard earned incomes of the citizenry. However, the idea is not without consequences.
Unfortunately, globalists have spent the better part of a half-century ensuring that individual nations are completely financially dependent on one another. The U.S. is at the very CENTER of this interdependency with our currency as the world reserve standard. In order to change the nature of the inderdependent system, we have to change the nature of our participation within that system. This means, in order to assert large tariffs on countries like China (which Trump has suggested), America would have to be willing to sacrifice the main advantage it enjoys within the interdependent model — we would have to sacrifice the dollar’s world reserve status.
Keep in mind, this is likely to be done for us in an aggressive manner by nations like China. China’s considerable dollar and treasury bond holds can be liquidated, and despite claims by mainstream shills, this WILL in fact have destructive effects on the U.S. economy.
Also keep in mind that with higher tariffs come higher prices on the shelf. The majority of goods consumed by Americans come from outside the country. Higher tariffs only work to our advantage when we have a manufacturing base capable of producing the goods we need at prices we can afford. The American manufacturing base within our own nation is essentially nonexistent compared to the Great Depression. In order to levy tariffs we would need a level of production support we simply do not have.
The point is, an unprecedented change in America's production dynamic would have to happen so that we do not face heavy fiscal consequences for the use of tariffs as an economic weapon.
Manufacturing Takes Time To Rebuild
Much excitement has been garnered by reports that certain U.S. corporations will be bringing some manufacturing back within our borders over the course of Trump’s first term as president. And certainly this is something that needs to happen. We should have never outsourced our manufacturing capability in the first place. But, is this too little too late? I believe so.
I remember back in 2008/2009 mainstream economists were applauding the Federal Reserve’s bailout efforts and the call for quantitative easing, because, they argued, this would diminish the dollar’s value on the global market, which would make American goods less expensive, and by extension inspire a manufacturing renaissance. Of course, this never happened, which only adds to the mountain of evidence proving that most mainstream economists are intellectual idiots.
It is important that we do not fall into the same false-hope trap in 2017. While Trump may or may not handle matters more aggressively, there is only so much that can be accomplished through politics. Rebuilding a manufacturing base after decades of outsourcing takes time. Many years, in fact. Factories have to be commissioned, money has to change many hands, wages have to be scouted for the best possible labor per-dollar spent and people have to be trained from the very ground up in how to produce goods again. In many cases, the skill sets required to maintain functioning factories in the U.S. (from engineers to machinists to assembly line labor to the people who know how to manage it all) just don’t exist anymore. All we have left are millions of retail and food service workers forming mobs to demand $15 an hour, which is simply not going to encourage a return to manufacturing.
Beyond this, at least in the short term, America will have a much stronger dollar on the global market, rather than a weaker dollar, due to the fact that the Federal Reserve has initiated a renewed series of interest rate increases just as Trump entered office. While the mainstream theorizes that the Fed will turn "dovish" and back away from rate hikes, I think this is a rather naive notion. It serves the elites far better to create a battle between Trump and the Fed – therefore, I see no reason for the Fed to back away from its rate hike process. Trump will demand a weaker dollar, the Fed won't give it to him, and ultimately, the global economy will start to see the dollar as a risky venture and dump it as the world reserve; which is what the globalist have wanted all along so that they can introduce the SDR as a bridge to a new world currency.
With a "strong" dollar (relative to other indexes) there is even LESS incentive for foreign nations to buy our goods now than there was after the credit crisis in 2008. If the dollar loses world reserve status (as I believe it will during Trump’s first term), then at that point we will have a swiftly falling currency — but too swift to fuel a manufacturing reboot.
Is there even enough internal wealth to support the rise of manufacturing within the U.S. for a period of time necessary for our economy to rebalance? If there is I’m not seeing it. We are a nation mired in debt. So much so that even selling off our natural resources would not erase the problem.
Ultimately, the shift away from being tied to a globalized system towards a self-contained producer nation with a citizenry wealthy enough to sustain that production in light of limited exports to foreign buyers is a shift that requires incredible foresight, precision and ample time. It is not something that can be ramrodded into existence through force or by government decree. In fact, the act of trying to force the change haphazardly will only agitate an economy already on the verge of calamity.
Solutions Start With The Citizenry, Not Washington
I understand that conservatives in particular want to “make America great again,” and I fully agree with that goal. But, someone has to point out the inconsistencies in the current strategy and recognize that the situation is beyond repair. To make America great again would require decentralized efforts to maximize production and self reliance at a local level, not centralized federal tinkering with the economy. The globalists have been far too thorough in their programs of interdependency. The only way out now is for the system to crash and for the right people to be in place to rebuild.
Sadly, not only will a crash result in great tragedy for many Americans, but it is also an outcome the globalists prefer. They believe that THEY will be the men in the right place at the right time to rebuild the system in an even more centralized fashion. They hope to sacrifice the old world order to inspire the social desperation needed to convince the masses of the need for a “new world order.” Again, this crash cannot be avoided, it can only be mitigated. We can prepare and become self sufficient. We can fight to ensure that the globalists are not in a position to rebuild the system in their image once the dust settles. But, we should not place too much expectation that the Trump administration will be able to solve any of our economic problems, if that is even their intent. The solution remains in our hands, not in the hands of the White House.
- Payrolls Preview: Expect An Upside Surprise (Thanks To The Weather)
Despite ADP's blowout print this week, consensus January payrolls is 175k (somewhat below the 6- and 12-month averages), but Goldman Sachs expects a higher 200k print thanks to a combination of lower-than-usual year-end layoffs, favorable weather effects, and further improvement in labor market indicators.
Notably, Bloomberg Intelligence explains that over the past decade, consensus has tended to overestimate the January payrolls gain, but it appears to have corrected this bias over the past five years — a period in which the average miss has been less than 5k. As such, the current consensus forecast implies a significantly weaker outcome than was suggested by the latest ADP employment survey, which showed a 246k increase in private payrolls.
The seasonal adjustment of the payroll data turns sharply negative in January, as recurring winter layoffs commence in a range of sectors. In recent years, the seasonal adjustment factor for January has averaged near -3036k. (In other words, employers typically layoff 3 million workers in January.)
Furthermore, as Goldman notes, the report will also be accompanied by the annual benchmark revision to the establishment survey as well as the annual introduction of new population controls in the household survey.
Overall Goldman forecasts that nonfarm payroll employment increased 200k in January, after an increase of 156k in December and 204k in November. Labor market indicators generally strengthened last month, with a drop in jobless claims between the survey periods to four-decade-lows and further improvement in the employment components of many service-sector and manufacturing surveys. The key labor market subcomponent of the consumer confidence report also rose to levels close to cycle highs. We also expect two temporary factors to boost January employment growth relative to surrounding months, specifically a weather-related rebound (on the order of 20-40k) and lower-than-usual year-end layoffs in the retail sector. On the negative side, we expect some pullback in transportation and warehousing payrolls following elevated growth in December, itself likely related to the secular shift toward online holiday sales.
Factors arguing for a stronger report:
- Weather rebound from December. Our analysis of NOAA (National Oceanic and Atmospheric Administration) weather station data suggests that unusually high snowfall during the December payroll survey period may have reduced job growth by roughly 20-40k. As shown in the left panel of Exhibit 1, snowfall in early January was much more in line with seasonal norms, suggesting scope for a weather-related rebound. Updating this analysis to incorporate regional granularity from the December state and local employment survey bolsters the case for January improvement, in our view. In addition to a 3k drop in the weather-sensitive construction category, the softness in overall December payrolls was particularly pronounced in the East North Central and Pacific regions, two parts of the country where snowfall was above seasonal norms during the week of December 17th. More specifically, in the right panel of Exhibit 1 we show that below-trend December payroll growth occurred in several states that also exhibited unusually high snowfall (in the weeks relevant for December payroll growth). Michigan, Illinois, Wisconsin, and Indiana stand out as four relatively large states where payrolls may have been depressed by weather in December.
Exhibit 1: Weather Likely to Boost January Payrolls Relative to December
Source: Source: National Centers for Environmental Information, National Oceanic and Atmospheric Administration, Department of Labor, Goldman Sachs Global Investment Research
- Jobless claims and retail layoffs. Initial claims for unemployment insurance benefits moved lower, averaging a four-decade-low 248k during the four weeks between the December and January payroll survey periods. While seasonally adjustment difficulties likely account for much of the drop, we believe some of the decline reflects underlying labor market improvement and relatively fewer January retail layoffs – both of which would suggest scope for a rebound in January payrolls growth.
- ADP. The payroll processing firm ADP reported a 246k rise in private payroll employment in January, up from +151k in December and well above expectations of +168k. In past research, we have found that large surprises in the ADP report tend to be predictive of the subsequent nonfarm payroll surprise. Additionally, we believe the above-trend growth in ADP construction employment (+25k) provides evidence for a rebound in weather-sensitive payrolls categories.
- Manufacturing sector surveys. The employment components of manufacturing surveys generally improved in December, with most now in expansionary territory. The ISM manufacturing employment component rose to a 30-month high (+3.3pt to 56.1), and the Philly Fed (+9.2pt to +12.8), Dallas Fed (+9.5pt to +6.1), Richmond Fed (+9pt to +8), and Empire State (+10.5pt to -1.7) employment indices also improved. On the negative side, the Kansas City Fed (-2pt to +6) employment component softened, and the Chicago PMI employment index declined into contractionary territory. Manufacturing payroll employment rose 17k in December, its first increase in five months.
- Service sector surveys. Most of the employment components of service sector surveys improved or remained at encouraging levels in January. The Philly Fed non-manufacturing employment index rose to a 1-year high (+2.8pt to +19.5) and the New York Fed index increased to an 18-month high (+4.5pt to +16.9, SA by GS). Meanwhile, the Richmond Fed (-4pt to +8.0) and Dallas Fed (-2.1pt to +4.8) measures pulled back modestly to levels still consistent with expansion. The ISM non-manufacturing survey will be released tomorrow, though the December employment index of 52.7 was consistent with moderate growth in service-sector jobs. Service sector payroll employment increased 132k in December and has increased 167k on average over the last six months.
- Job availability. The Conference Board’s Help Wanted Online (HWOL) report showed an increase in online job postings for a second consecutive month in January, though their total job ad count remains 9.5% lower on a year-over-year basis (vs. -8.8% in December and -14.9% in November). We place a limited weight on this indicator at the moment in light of research by Fed economists, which suggests the HWOL ad count has been depressed by higher prices for online job ads.
Arguing for a weaker report:
- Transportation jobs. Transportation and warehousing payrolls have seen elevated growth in December in recent years followed by softer growth or outright declines the next month, a phenomenon that may be driven by a secular shift toward online holiday sales. This winter seems to be exhibiting the same pattern, as transportation payrolls increased at an above-trend pace of +15k in December. With the holidays now behind us, we expect tomorrow’s report to show restrained growth or a modest decline in this category.
- Early-month storms in the South. Despite fairly unremarkable snowfall on a national basis during early January, one counterargument against the case for a weather-related rebound is the early-month snowstorms in the South, a region less accustomed to severe winter weather. While admittedly a risk, we would note that these storms generally occurred the Friday and Saturday before the survey week, and our analysis of snow cover – the depth of snow recorded by weather stations on a given day – indicates that most of the snow accumulation had melted by the Monday or Tuesday of the survey week (see Exhibit 2). Accordingly, we believe the negative payrolls impact of these storms is likely to be fairly modest, though storm-related absences could exert some downward pressure on hours worked (for employees with multi-week pay periods).
Exhibit 2: Most of the Snow Accumulated in the Southern Winter Storms Had Melted by the Monday and Tuesday of the Payroll Survey Week
Source: Source: National Centers for Environmental Information, National Oceanic and Atmospheric Administration, Goldman Sachs Global Investment Research
- Seasonals. Since 2010, January payroll growth has surprised negatively relative to consensus in five of the seven instances, with an average miss of -18k. While this may suggest some downside risk at the margin, we would note that severe winter weather was likely a factor in some of these observations (2010 and 2011, for example).
Neutral factors:
- Federal Hiring Freeze. The new administration’s announced hiring freeze for Federal works took place on January 23rd, over a week after the January payrolls survey period had ended. As a result, we do not expect any negative impact on the January employment report. In fact, we see some possibility of a positive impact if, for example, some federal departments anticipated the hiring freeze and front-loaded employment growth accordingly. That being said, we doubt we will observe evidence of a material impact in the aggregate data.
- Job cuts. Announced layoffs reported by Challenger, Gray & Christmas after our seasonal adjustment declined by 5k to 36k in January, though the level of announced layoffs remains moderately above the October lows.
* * *
We believe that the unemployment rate is likely to fall one-tenth to 4.6% (from 4.716% unrounded) – which would mark a return to the cycle low – driven by reduced year-end retail layoffs and our expectation of broader labor market improvement in January. We forecast average hourly earnings to rise 0.3% month over month and 2.8% year over year, reflecting firming labor markets and state-level minimum wage hikes. Our estimate incorporates a boost of 10 basis points from minimum wage hikes, which affected 19 states and increased the effective national minimum wage by about $0.25 (to $8.50 per hour).
Tomorrow’s employment report will be accompanied by the annual benchmark revision to the establishment survey as well as the annual introduction of new population controls in the household survey. In September, the BLS released a preliminary estimate of the establishment survey revision, which suggested a downward adjustment of 150k to the level of March 2016 employment (or -12.5k per month from April 2015 to March 2016). This preliminary estimate appears broadly consistent with the trends in the Quarterly Census of Employment and Wages, from which the benchmark revision is primarily derived. We would note that the composition of September’s preliminary estimates was somewhat unfavorable, with a larger downward revision expected in private payrolls (-224k) – concentrated in professional services (-133k) and retail trade (-120k) – offset by an expected upward revision to the level of government employment (+74k).
As a reminder the entire world is long stocks, short vol, and short bonds, so any surprise tomorrow that would upset The Fed's carefully choreographed 3-rate-hikes plan could spook a very one-sided ship.
But if that fails Buy The Fucking Payrolls Dip no matter what…
- Will "Big Data" Make A Centrally Planned Economy Possible?
Submitted by Xiong Yue via The Mises Institute,
Many of us were once convinced that idea of the centrally-planned economy, both in theory and in practice, had been completely buried. Most economists today would argue that the planned economy doesn't work, and in the last two decades of the twentieth century, almost all the planned economies shifted toward market economics.
However, with the development of new technologies such as cloud computing, big data, and artificial intelligence, some people are starting to believe that – with the help of powerful new technologies – we can finally achieve a planned economy.
In a recent speech, Jack Ma, one of China's most famous entrepreneurs and Founder and Chairman of Board of Alibaba Group, has expressed his optimism for the future recovery of the planned economy. He declares:
Over the past 100 years, we have always felt that the market economy is excellent, but in my opinion, in the next three decades will be a significant change, the planned economy will become increasingly large. Because we have access to all kinds of data, we may be able to find the invisible hand of the market. … [I]n the age of data, it is like we have an X-ray machine and a CT machine for the world economy, so 30 years later there will be a new theory [on planned economy] out.
Well, as a grand, romantic dream of the humankind — although the planned economy has failed several times in its operation in the real world — I am not surprised to know that it is still quite attractive to social elites such as Jack Ma.
It is true, to some extent, that with the development of technologies, central planners now can obtain more data and information, and their ability to analyze these data and the information is greatly enhanced as well. Moreover, in the foreseeable future, those skills will be further enhanced. Ma believes a planned economy can be achieved in the future precisely because of his companies, Taobao and Alipay, are ubiquitous in the areas of e-commerce and payment in China and therefore can collect an enormous amount of consumption data. To Jack Ma himself and other "technical socialists," such data could be the cornerstone of the operation of the planned economy.
However, if we look at this more closely, we realize these data are mere:
(1) data based on real deals of the past, which can not be used to predict the consumer preferences in the future; or
(2) data obtained using questionnaires, which can not reflect the real demonstrated preferences of customers.
In either case, with the dazzling new technologies, what central planners can get is still a guess of the real world, a beautiful mirage.
Besides, those who consider the problem of socialism as merely a problem of information failed to understand that the core problem of socialism lies in the absence of prices in a centrally-planned economy. The role of prices in the market economy is unique because money prices offer an indispensable tool in economic calculation. As Mises writes in Human Action,
One cannot add up values or valuations. One can add up prices expressed in terms of money, but not scales of preference.
With prices as a guide, entrepreneurs can potentially pursue profits by examining differences in the market prices of production factors and the expected prices of the final products. He or she can then organize production accordingly.
Therefore, even if we have some excellent data already, without this market-price mechanism, neither the economic calculation nor the efficient allocation of resources is possible; the planned economy is therefore not feasible. Because rationally planning or resource allocation requires the ability to calculate economically, such calculations need the prices which can be determined only in the market by the real-world exchange of owners of private property in the first place. Since the planned economy requires state and collective control of resources — and thus no tallow for these necessary voluntary exchanges between owners — it cannot rationally plan the operation of the modern economic system.
As a result, it's theoretically impossible for a planned economy to determine the prices needed for economic calculation. The cutting-edge technologies may help Jack Ma to optimize his strategies in his private enterprises in a relatively capitalist society. However, for a modern economy, as long as there are no prices available on which to base economic calculation, the failure of a planned economy is inevitable. As Joseph Salerno writes in his postscript to “Economic Calculation in the Socialist Commonwealth”:
[I]n the absence of competitively determined money prices for the factors of production, possession of literally all the knowledge in the world would not enable an individual to allocate productive resources economically within the social division of labor.
- Spot The Intervention (Bank Of Japan Edition)
We warned earlier “the market would test the BoJ,” and sure enough Kuroda and his ‘lost boys’ answered the market’s question by intervening aggressively (offering to buy an unlimited amount of bonds) to rescue what was a rapidly escalating collapse in Japanese government bonds.
As Bloomberg reports, The Bank of Japan offered to buy an unlimited amount of bonds at a fixed rate in an unscheduled operation to reassert control over surging yields. The yen and yield for 10-year debt fell.
The central bank will buy five-to-10 year securities from the secondary market, it said in a statement Friday. It’s offering to buy the benchmark 10-year notes at 0.110 percent, it said.
The move comes after an earlier attempt Friday morning to cap yields by expanding bond purchases in a regular operation failed.
Governor Haruhiko Kuroda on Tuesday recommitted to his strategy to hold 10-year debt yield at around zero percent even as accelerating inflation and an improving outlook for some of the world’s biggest economies push up bond yields globally.
The reaction is self-evident…
And USDJPY spiked…
It would appear Governor Kuroda has shown his hand one too many times (after November’s first operation – which failed to garner any bids).
- Canadian Mint Worker Sentenced To 30 Months For Smuggling $140,000 Of Gold In His Rectum
In September we reported that an employee of the Royal Canadian Mint smuggled C$180,000 (USD $140,000) in gold from the fortress-like facility, evading multiple levels of detection with a time-honoured prison trick: hiding the precious metal up his butt.
Having been found guilty in November ("wait, what gold coins, where?"), 35-year-old Leston Lawrence was sentenced to 30 months in prison today, by a judge whose name was 'Doody'.
As we detailed previously, a suspicious bank teller raised the alarm in 2015. Lawrence sold 18 gold pucks — each a circular 7.4-ounce nugget worth about $6,800 — to an Ottawa Gold Buyers store between Nov. 27, 2014, and March 12, 2015, according to court records obtained by the Toronto Sun. Three observations tipped off the bank teller: Lawrence was a mint employee, he had an unusual number of deposits and he frequently requested overseas transactions.
Furthermore, as the OC reports, the case is "an illuminating look at security measures inside the Mint, the building on Sussex Drive that produces hundreds of millions of gold coins annually for the federal Crown corporation." Or rather lack thereof.
The defense was not happy: “Appalling,” was the conclusion of defence lawyer Gary Barnes, who described the Crown’s case as an underwhelming collection of circumstantial evidence. “This is the Royal Canadian Mint, your Honour, and one would think they should have the highest security measures imaginable,” Barnes said in his closing submission. “And here the gold is left sitting around in open buckets.”
He is right, and perhaps anyone who keeps their gold at the mint may want to reconsider the venue of storage.
Court was further told that, on multiple occasions, Lawrence took small circular chunks of gold – or “pucks” – to Ottawa Gold Buyers in the Westgate Shopping Centre on Carling Avenue. Typically, the pucks weighed about 210 grams, or 7.4 ounces, for which he was given cheques in the $6,800 range, depending on fluctuating gold prices, court heard. He then deposited the cheques at the Royal Bank in the same mall.
One day a teller became suspicious at the size and number of Ottawa Gold Buyers cheques being deposited and Lawrence’s request to wire money out of the country. She then noticed on his account profile that he worked at the Mint. The first red flag was up. Bank security was alerted, then the RCMP, which began to investigate. Eventually, a search warrant was obtained and four Mint-style pucks were found in Lawrence’s safety deposit box, court heard.
Records revealed 18 pucks had been sold between Nov. 27, 2014 and March 12, 2015. Together with dozens of gold coins that were redeemed, the total value of the suspected theft was conservatively estimated at C$179,015.
That said, the defence countered with a couple of important points. The Crown was not able to prove conclusively that the gold in Lawrence’s possession actually came from inside the Mint. It had no markings nor, apparently, had any gold been reported missing internally. The Crown was able to show the pucks precisely fit the Mint’s custom “dipping spoon” made in-house — not available commercially — that is used to scoop molten gold during the production process.
Still, one question remained unanswered at the trial: how did the gold get out of the Mint?
The court was told Lawrence set off the metal detector at an exit from the “secure area” with more frequency than any other employee — save those with metal medical implants. When that happened, the procedure was to do a manual search with a hand-held wand, a search that he always passed. (It was not uncommon for employees to set off the detector, court heard.)
Investigators also found a container of vaseline in his locker and the trial was presented with the prospect that a puck could be concealed in an anal cavity and not be detected by the wand. In preparation for these proceedings, in fact, a security employee actually tested the idea, Barnes said.
As a result, prosecutors alleged that Lawrence smuggled out gold nuggets inside his rectum.
And now, almost 2 years later, as AP reports, the former Royal Canadian Mint employee who stole 22 cookie-sized pieces of refined gold by hiding them in his rectum has been sentenced to 30 months in prison.
Thirty-five-year-old Leston Lawrence was found guilty last November of stealing the pieces from the mint and selling 17 of them through Ottawa Gold Buyers.
Ontario Court judge Peter Doody on Thursday sentenced Lawrence and ordered him to pay a fine of US$145,900 (CA$190,000).
Doody says the stolen gold was worth US$127,116.11 (CA$165,451.14) which Lawrence sent abroad to build a house in Jamaica and buy a boat in Florida, among other transactions.
Court testimony indicated that Lawrence was involved in purifying recently procured gold and sometimes worked alone, out of sight of security cameras.
The Royal Canadian Mint has announced intentions to improve their security in the wake of the crime:
"upgrades to our facility's security checkpoint and screening process; upgrades to our camera system to high definition which provides real-time monitoring capability in all areas of the mint; and working closely with CATSA [Canadian Air Transport Security Authority] to establish more robust scanning training of our employees."
"The mint is one of the most secure facilities in Canada and we are confident that we have the right security measures in place to effectively operate our business,"
The mint did not comment as to whether or not employees will now face rectal-cavity searches.
Maybe those cryptocurrency types are right – hording gold is a pain in the ass.
- #GrabYourWallet Wins! Nordstrom Cuts Ties with Ivanka Trump's Clothing Line
Because they believe Trump to be the second or third coming of Hitler (if you recall, Bush was Hitler too), the folks over at Grab Your Wallet have pursued anyone who did business with the Trump family — as a form of political persecution to punish those even remotely affiliated with the Trump brand. Look, they even went through the trouble of slapping a rudimentary spreadsheet together, so that fellow minded snowflakes might protest with their, err, wallets.
To that end, it appears they’re activism worked. Nordstrom has announced they’re officially cutting ties with the Ivanka brand — citing poor sales as the reason for the ‘de-stocking.’
“Each year we cut about 10% [of brands carried] and refresh our assortment with about the same amount,” a Nordstrom spokesperson told Business Insider. “In this case, based on the brand’s performance we’ve decided not to buy it for this season.”
The founders of Grab Your Wallet, Shannon Coulter and Sue Atencio (they met on Twitter), are quite pleased with this news. Coulter said, “I am absolutely thrilled, and I know the vast majority of Grab Your Wallet participants will be as well.”Indeed.
The cucked Coulter has bee meticulously tracking the availability of Ivanka’s brand, wherever it’s sold. The fashion website ‘Racked‘ chronicled Coulter’s journey in an article published this evening — to celebrate the apex of Coulter’s success — the rueful malevolence towards another human being for the sole purpose of making another person suffer.
This could very well be some lag time before its spring inventory. But Coulter has been keeping track of the number of Ivanka Trump items the 116-year-old Seattle-based retailer is selling on its site, and the merchandise has been on a decline: From December 2 to December 27th, the number dropped from 71 products to 48. As of January 11th, Nordstrom was selling 43 products, but by January 29th, it was down to 26, according to Coulter’s calculation. (The Macy’s site, on the other hand, has 90 items listed, all with deep discounts.)
As of today, February 2nd, Nordstrom is down to four items. On the Ivanka Trump website, the items from outfits posted four days ago that link out to Nordstrom are no longer available on the site.
That said, stores are still selling the label; a Racked editor who visited a Nordstrom location in White Plains, New York, last Sunday confirms there were plenty of Ivanka Trump shoes in store.
The #GrabYourWallet was started by Coulter and Sue Atencio, a woman she met on Twitter. The duo felt hesitant to shop at retailers that carried Trump family-related products, and when they spoke about it on Twitter, they were met with tons of similar feelings. They started a Google spreadsheet, and the list has since been moved to its own website, GrabYourWallet.org.
The boycott list now includes many major department stores, including Macy’s, Neiman Marcus, Bloomingdale’s, and Lord & Taylor, as well as HSN, Century 21, Overstock.com, and DSW. Each retailer is listed with an explanation as to why it’s being boycotted.
“What this boycott means to me is that companies that I love, like Nordstrom and Amazon, are making money from the Donald Trump campaign, which to me is synonymous with hate and divisiveness so I can’t, in good faith, shop there anymore,” Coulter told Racked back in November. “People aren’t boycotting them to punish them or ruin any businesses. They want to support these companies but can’t do so in good conscience.”
The Ivanka Trump line was included in the boycott, Coulter added, because “she made her father palatable to many young female voters, and her being on the campaign trail, and returning to campaign with him after the Trump tapes, has as much to do with her ambitions as it has to do with her father’s.” (Ivanka formally left her namesake label earlier last month, after her husband, Jared Kushner, took the position of senior White House adviser.)
If Nordstrom is, indeed, dropping the Ivanka Trump label, it won’t be the only retailer to heed to the boycott. In November, Shoes.com told Coulter via Twitter it was dropping the line. There will likely be backlash-to-the-backlash, as evident when L.L. Bean was boycotted by anti-Trump shoppers, then Trump encouraged his fans to buy L.L. Bean as a result.
But this would be a big win for #GrabYourWallet. Coulter says that on January 21st, participants voted that Nordstrom was the most boycott-able company on the list; based off a poll that had 249 participants, Nordstrom was ranked number one, Coulter says, because “that’s the store they’d most like to be able to shop again.”The tolerant left.
All is not doom and gloom for Ivanka, however. According to G3’s 2016 annual statement, ticker $GIII, the manufacturer and distributor of Ivanka’s clothing line, the brand is doing quite well — enjoying a $29.4m bump in sales to $100m.
“Initially, when her father started to run for President, I wondered if there’d be a negative or positive effect,” said Sammy Aaron, vice chairman of G-iii, who oversees the Ivanka Trump brand at the company as well as being CEO of its Calvin Klein division. “We’ve really seen very little effect.”
Source: Forbes
That it’s already seeing revenues of $100 million a year is impressive. “You have designers who do less than that,” Stone said. By way of comparison, sales of Mary-Kate Olsen and Ashley Olsen’s high-end line The Row are reportedly closer to $50 million — itself a high estimate, per an insider. And while some celebrities have little involvement in their licensed brand beyond the approval process, Ivanka Trump is hands-on.
Ivanka is “very involved on a weekly basis” in all stages of the design process, said Aaron, who described her as “one of the most impressive young women” he’s ever met.
“She’s super sensitive to things with her name on it,” he said. “She’s not one of these names just looking for revenues. She’s an assertive person who has definitive taste and a definitive opinion.”
It sounds like Ivanka will survive the scourge of the Twitterati army of Grab Your Wallet miscreants.Content originally generated at iBankCoin.com
- What Google Trends Reveal About The State Of America's Torn Society
By Nicholas Colas of Convergex
E Pluribus Google (Trends)
If you want to know what’s really on the minds of the American population since the Election, just look at Google search trends. For example, did the Dow hitting 20,000 last week spark a lot of interest in the stock market or that venerable measure? Not really – searches for “Stock market” and “Dow Jones” are the same now as last year at this time. What DID force public attention on those terms was (you guessed it) the US Election. That event increased searches by +400%, as investors wondered about the effects of President Trump’s surprise win on capital markets. Equities have, if course, done well since then. But… won’t all the protests against the new President serve to dampen his effectiveness? Maybe not. Google searches for “Protest Trump” are already a running at a fraction of their volumes immediately post-Election, although searches for general “Protest” are still equal to levels from the week of November 7th. Also in this note: Google search trends related to the US labor market, asking for a raise (the right way), and how to move to Canada.
* * *
“If Donald Trump wins, I will move to Canada!” That was a popular refrain in some circles just before the US Election last November. Searches on Google for “Move to Canada” were up 20-fold over the week of November 7th, supporting the notion that some citizens were exploring the possibility leaving the US. A deeper look at the data, courtesy of Google Trends (www.google.com/trends) gives us some more information about this topic:
- The “Move to Canada” trend was short lived. By late November 2016, searches for that phrase had returned to their typical pre-election run rate.
- Interest among Americans in moving north tends to run along Presidential election cycles, with bumps in November 2004, 2008, 2012. This cycle was, however, the largest surge of interest in the last 12 years (essentially Google Trend’s entire historical record).
- The US citizens typically (i.e. not just around elections) most interested in moving to Canada are not left leaning bi-coastal hipsters; rather, they are simply people who live in US states that border Canada. Currently, the people of Montana, Idaho, Alaska and Washington punch “Move to Canada” into Google more than all other US states.
- As an aside, “Move to Mexico” is nowhere near as popular among American Google users as “Move to Canada”. Over the past year, for example, searches for the latter outnumber the former by three or four to one.
So have those Americans who searched for new homes in Canada decided to stay and protest the new administration as members of the loyal opposition? Perhaps… Here is some Google Trend data on that topic:
- Google searches for “Protest Trump” spiked around the Election, as one would expect. To give some sense of scale, however, search volumes on Google for “Starbucks” were 3x higher than “Protest Trump” and those for ‘iPhone” were 10x higher during the week of 11/7/2016. That’s not to minimize the scale of social discontent, but merely to put it in context with some common searches.
- “Protest Trump” searches had another peak around the Inauguration, but volumes there were less than half those from Election week. For the most recent week, searches for that term are only 32% of those from November.
- The 5 states that most commonly search for “Protest Trump”: Washington, Vermont, DC, New York, and Rhode Island. As far as cities go, the top 5 are Portland (OR), Seattle, New York, San Francisco and Los Angeles.
- Make the search term more generic – just “Protest” – and a different story emerges. Here, search volumes peaked just last week. There was a bump around the Election, of course, Google users are looking to “Protest” now just as much as last November.
- The states with the largest interest in “Protest” are: North Dakota (likely pipeline related), Washington, Vermont, DC and South Dakota (also pipeline). By city, Oakland, Portland, Seattle, Minneapolis and San Francisco make up the top 5.
- Why worry about protests? It is all part of our “Trump on, Trump off” market construct. As long as equity markets believe President Trump will be able to execute on his plans for lower business/individual taxes, infrastructure spending and regulatory reform, we have a good chance of seeing higher equity prices. But if large public protests develop, perhaps capital markets will lose some of that conviction. We don’t have enough experience with a President Trump to know how that dynamic plays out over time, but it is worth watching now.
How about the recent news that the Dow had finally hit 20,000? Did that spark broad interest in the stock market or the Dow Jones Industrial Average? The answer:
- American public interest in searches for the “Stock market” and “Dow Jones” has picked up since 2015 by almost 30% as compared to 2012-2014. A piece of this is the incremental interest when market volatility hits (August 2015 and November 2016 are the best examples).
- That said, breaching the 20,000 mark did nothing for Google search volumes for either term. This may not be “The most hated rally of all time”, as much of the 2009-2016 move was called, but it may well be “the most ignored rally of all time”.
You can also use Google Trends to analyze the US labor market. Five points on that topic:
- Don’t worry too much about wage inflation. Google users are no more likely to be researching how to ask their boss for more money now versus a year ago. We used “Ask for a raise” and “get a raise” search phrases to assess levels of general popular interest.
- And even if they do ask, related Google searches tell us they may not be going about it correctly. Consider that “How to ask for a raise email” and “via email” are popular variants of “ask for a raise”.
- When you look to see which US states have an above-average number of Google users intent on negotiating for more money at work, the answer is not surprising: New York, California, Illinois and Texas. The only city that shows up on the Google data as statistically significant: New York. Bottom line: wages may see pressure where large urban areas with predominately college-educated workers dominate the local economy, but not for the country as a whole.
- Getting a new job is a common New Year’s resolution, and this January saw a record number of Google users actually search for “New job” the week of January 1. This could lead to more changes in the US labor force this year if workers actually follow through on their goal of landing a new position.
- Searches for “Find a job” and “get a job” are lower in 2016 than 2012, but largely similar to 2015. That’s surprising, given that the official government data shows a decline in unemployment from 6.3% in Q1 2015 to just 4.7% in Q4 2016. After all, if there are fewer people unemployed, why wouldn’t search counts decline modestly as well?
To sum up: Google Trends tell us that there isn’t enough attention focused on the US stock market to be worried that we are in a “Bubble”. That’s the good news. On the other side of the coin, there’s a lot of attention sloshing around elsewhere. As long as markets stay focused on the potential upsides of a Trump administration, the stealth rally can continue. Inevitably, however, there will be some lapses. We haven’t seen one yet; I am sure we will.
- Reddit Bans Three Alt-Right Forums As Users Blast "Leftist Intolerance"
In what will undoubtedly be viewed as just another attempt to censor dissenting, conservative political views, Reddit has banned three major ‘alt-right’ subreddits, /r/altright, /r/rightyfriends and /r/alternativeright, this evening for allegedly breaching the company’s content policy restricting the sharing of personal, private information. The so-called ‘Alt-right’ group had roughly 16,000 followers and grew in popularity last summer along with the rise of Donald Trump’s political campaign.
While Reddit hasn’t yet issued a formal statement on the ban, the following comments were offered up to The Daily Beast:
“Reddit is the proud home to some of the most authentic conversations online,” a statement provided to The Daily Beast by the company read. “We strive to be a welcoming, open platform for all by trusting our users to maintain an environment that cultivates genuine conversation and adheres to our content policy.”
“We are very clear in our site terms of service that posting of personal information can get users banned from Reddit and we ask our communities not to post content that harasses or invites harassment. We have banned r/altright due to repeated violations of the terms of our content policy. There is no single solution to these issues and we are actively engaging with the Reddit community to improve everyone’s experience.”
A senior moderator of the atlright subreddit, who referred to himself as Bill Simpson, told The Daily Beast that the forum was “banned without notification or justification” and insisted that moderators “enforced stricter standards of behavior than reddit requires.”
“So much for leftist tolerance. Our moderator team enforced stricter standards of behavior than reddit requires, and our users were very prompt at reporting violations so we could ban violators and delete posts and comments that broke the rules,” he added.
Additionally, Simpson claimed that the subreddit was banned because of its recent “record monthly traffic.”
“It’s clear that Reddit banned us because we were becoming very popular and spreading inconvenient truths about who’s ruining our country and robbing our children of a future,” Simpson said.
The announcement of the ban came just days after Reddit founder Alexis Ohanian penned an open letter trashing Trump’s immigration ban, calling it “not only potentially unconstitutional, but deeply un-American.”
After two weeks abroad, I was looking forward to returning to the U.S. this weekend, but as I got off the plane at LAX on Sunday, I wasn’t sure what country I was coming back to.
President Trump’s recent executive order is not only potentially unconstitutional, but deeply un-American. We are a nation of immigrants, after all. In the tech world, we often talk about a startup’s “unfair advantage” that allows it to beat competitors. Welcoming immigrants and refugees has been our country’s unfair advantage, and coming from an immigrant family has been mine as an entrepreneur.
Of course, all of this comes after Reddit CEO, Steve Huffman, admitted two months ago to editing individual posts made by Trump supporters that were critical of him. Per the apology below, Huffman edited posts to redirect criticism away from him and onto the moderators of the “r/the_donald” thread.
Free speech is a wonderful thing, provided it conforms to the prevailing political views of Silicon Valley’s elitist tech billionaires.
- The Uncanny Similarities Between President Trump And FDR
Submitted by Jeff Brown via The Saker,
Trump and Roosevelt: two peas in a pod?
For the record, I voted for Donald Trump. Not that I was in love with the guy. It was really a matter of default. On the Oklahoma state ballot, I had the choice of Hillary “Crimes Against Humanity + Here Comes World War III” Clinton, the Libertarian candidate Gary Johnson and Mr. Trump. I chose Trump, a populist, sometimes demagogue and buffoon, but a real outsider who might shake the establishment up.
It is still early, but no one can say that the first two weeks of Trump’s administration have been boring or predictable. He loudly called the outgoing CIA director, John Brennan, a liar and said that the agency’s Russia dossier was all fake news. John F. Kennedy said just as much in private and paid the ultimate price for his honesty. Trump has apparently kept on his own private security services, since getting elected, to avoid the same fate as JFK.
President Trump canceled the Transpacific Partnership (TPP), which was bad for everybody involved, except the transnational corporations who bribed, extorted and blackmailed some Pac Rim countries into signing on. But even America’s corporate owned Senate and Congress were resisting. Why? Because a signatory country gives up its national sovereignty to a corporate picked “international arbitration commission”.
Under the TPP, any company can take any country’s laws to this “unbiased” group of corporate jocks and claim that they are an “infringement on trade”. Think GMOs, agricultural chemicals, cultural and religious laws, subsidies to promote national industries and infrastructure; media and internet regulations; medicine and social security; environmental, worker and civilian safety laws, taxation, and on and on. Once this unelected, corporate board rules against any and all national laws, then the signatory country’s legislature is required to abolish those law and regulations, in the name of “free trade”.
So, Mr. Trump, thank you cancelling this Orwellian, plutocratic, corporatocracy. I can assure you, Baba Beijing wants nothing to do with it. China’s leaders want to govern and help their people, not be tyrannized and humiliated by faceless transnational corporations.
I watched Trump’s inauguration day speech. I also watched Trump’s press conference, with small and medium sized business owners, and in both cases, I was amazed at the similarities between him and President Franklin Delano Roosevelt (1933-1945).
The first observation that really struck me is how much Trump genuinely cares about “the little guy”. It’s not phony. He really does want to help the people in America who have been disenfranchised from having a voice in their destiny, something that has been building up for quite a long time. FDR was just as sincere about helping all the millions of hungry, homeless and jobless Americans, during the Great Depression. The US had to wait eight years after the Great Financial Crash of 2008, also known as the Great Middle Class Gang Bang, for populist Trump to ride to the rescue.
Both presidents came from wealthy backgrounds, with the proverbial silver spoon in their mouths. FDR’s family made its fortune via the organized crime opium cartel in China, 1839-1949. Trump’s father was a big construction, slum lord and real estate tycoon in New York City. He was investigated on numerous occasions for illegal business practices. You don’t succeed in these Big Apple business sectors and not be in the good graces of the Mafia.
Using his patrician family’s name, FDR worked his way up to the top of the American political system, to eventually become president. Donald Trump used his father’s wealth and connections to work his way up the corporate and media ladder, to eventually occupy the White House.
Both men are “rich, fat and happy”, to use the expression, and do not have to make all the sacrifices and take all the risks to run the United States, but both have their principles, ideas and visions for the future (For simplicity, I will use the present tense to compare both presidents, even though they lived generations apart).
Both men want to put Americans back to work again and reignite the country’s industrial potential.
Both men are disgusted with the usurious, rapacious, private Federal Reserve banking system. FDR complained bitterly about the Fed in his private writings and only obliquely so, in public. Trump is more vocal and seems less intimidated by the elite banking families, Rothschild, Rockefeller, Morgan, Carnegie & Co., the real owners of the United States and Europe. JFK was circumventing the Fed, by having the Treasury Department mint “silver certificate” bills outside the purvey of the Fed banks, another reason he lived a very short life. With his purported private security forces keeping him safe from the CIA, maybe Trump feels just as safe from the agency’s historical deep state partners, the aforementioned oil bankers.
Both men have a strong vision for what ails the country. For FDR, it was the New Deal. For Trump, it is “Put Americans First”.
Both men are despised by the elites. Both men are proud of it too. FDR famously said he welcomed the hatred of Wall Street. Trump has repeatedly threatened and is starting to act on his promise to “drain the swamp in Washington”.
Both men take the choice of Supreme Court justices very seriously and both have a chance to really change the political leanings on the bench. For FDR, it was to make the Supreme Court more liberal. For Trump, it will be to make it more socially conservative. Both believe their choices will be for the betterment of the citizens.
Both men know how relate to their constituencies, the man and woman on the street, the little guy and gal, Joe and Jane Sixpack. FDR ruled the radio waves with his famous “fireside chats”, bucking up the populace to work hard, stay positive and look forward to better times. Trump is a brilliant manager of the media and does not hesitate to take his populist message to his base, via social media, such as Twitter and Facebook. As a result, both presidents’ voters love them and are not hesitant to let everybody know this fact.
Conversely, both presidents have a big chunk of the electorate who despise them. For Trump, it is the wealthy elites and liberals. For FDR, it was these same elites, but the other group was middle America’s conservative and Christian block. So in essence, FDR and Trump have kept the wrath and indignation of the ruling Princes of Power, but have switched sides on Main Street, making a very interesting dynamic, for sure.
Both men talk about keeping America safe from external enemies. FDR ended up getting the US into World War II, ostensibly to do just that. The jury is still out on how aggressive Trump will be in dropping bombs and drones on thousands of innocent Muslims across the planet, in the name of fighting “Islamic terrorism”.
As a result of getting into World War II, FDR greatly increased the size and technology of the US military. Trump says he too, wants to greatly expand the military budget, and make it “unbeatable”.
Both presidents believe in Keynesian deficit spending, to boost the economy. FDR greatly expanded government programs to help the downtrodden, as well as turn the US into a war economy, with World War II. Trump wants to spend lavishly on the military and dramatically lower business taxes, just like a country at war, while going into even deeper debt than the already official $20 trillion void Americans are on the hook for.
Both FDR and Trump want to work with Russia. Roosevelt and Soviet leader Josef Stalin had a good working relationship together. Trump is signaling his desire to work on the positive side of the ledger, with Russian President Vladimir Putin.
In part due to his family’s historical role of “working” in China (in fact, selling illegal drugs), FDR had a fancy for this country. In his own way, he strived to make China a part of the postwar Western world order, but with all the historical colonialist, imperialist baggage in tow, he was doomed to fail. This is why a guy by the name of Mao Zedong came along with a better idea for his people. Trump has been all over the place with China, saying he wants to “cut a deal” with President Xi Jinping, while raising tariffs 45% across the board, but mixing in Taiwan and threatening to upturn the “One China Policy”, which if pushed to the extreme, could cause World War III. Here’s to hoping that Trump takes a fancy to the People’s Republic, like Roosevelt, but without all the “Great Game” imperial megalomania and cupidity.
These amazing corollaries between Presidents Franklin Delano Roosevelt and Donald Trump will surely grow, as Trump’s presidency takes root. It’s going to be an interesting next four to eight years, indeed. And dare I say, like my grandparents did during the 1930s, that it’s a time for hope?
Soul brothers in a parallel universe…
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