Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-64397 Thu, 15 Nov 2018 02:37:37 GMT Why Amazon Chose New York and Northern Virginia for New Headquarters http://implode-explode.com/viewnews/2018-11-14_WhyAmazonChoseNewYorkandNorthernVirginiaforNewHeadquarters.html To recap: a company whose profits soared 27 percent to $3.03 billion last year just received an additional $2 billion or more in tax breaks, and may also be in line for $10 billion more in tax money through the JEDI deal.

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No population genuinely worried about abuses of power would even countenance placing a single private company in control of securing the data of both the intelligence community and the armed services. Add putting a major media organ or two under the same umbrella and you're beginning to enter oligarchy territory.

Moving Amazon closer to America's political and financial capitals isn't just about creating a few jobs. It's also a symbolic move that speaks to the unsettling co-mingling of state and corporate power. We might wake up soon and wish we hadn't put so many eggs in one basket.

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iehi-feed-64391 Wed, 14 Nov 2018 01:37:42 GMT Sears Didn't 'Die.' Vulture Capitalists Killed It. http://implode-explode.com/viewnews/2018-11-13_SearsDidntDieVultureCapitalistsKilledIt.html ... most of the coverage has failed to stress the deeper story. Namely, Sears is a prime example of how hedge funds and private equity companies take over retailers, encumber them with debt in order to pay themselves massive windfall profits, and then leave the retailer without adequate operating capital to compete.

Part of the strategy is to sell off valuable real estate, the better to enrich the hedge fund, and stick the retail company with costly rental payments to occupy the space that it once owned.

In the case of Sears, the culprit is a hedge-fund operator named Edward Lampert, once a senior merger guy at Goldman Sachs. In 2005, Lampert merged Sears with Kmart, loaded both up with debt, and used some of the debt on stock buybacks to pump up the share price and enrich shareholders, notably himself and his hedge fund.

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iehi-feed-64386 Sun, 11 Nov 2018 22:28:58 GMT Were GOP's House losses dramatically smaller than historical pattern? (A: NO) http://implode-explode.com/viewnews/2018-11-11_WereGOPsHouselossesdramaticallysmallerthanhistoricalpatternANO.html The Republicans did have to cope with many retirements, which in 2018 reached a high for Republicans going back at least as far as 1930. But Trump is wrong that the Republicans outperformed historical precedents. The losses were fairly average or worse than average.

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Indeed, if you look just at losses suffered under Republican presidents, the total for 2018 exceeds all but two midterms going back to the Great Depression. The 2018 total even edged out the losses under George W. Bush in 2006, which was the last time the Democrats re-took the House in a midterm election.

"This one was clearly pretty bad," said Alan Abramowitz, an Emory University political scientist.

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iehi-feed-64385 Sun, 11 Nov 2018 21:08:50 GMT Doug Noland: Back to Fundamentals http://implode-explode.com/viewnews/2018-11-11_DougNolandBacktoFundamentals.html For me, Back to Fundamentals means a return of "Periphery to Core Crisis Dynamics" - rising yields, widening Credit spreads, de-risking/deleveraging, faltering global liquidity and, to be sure, China... Odds are mounting that de-risking/deleveraging dynamics attain destabilizing momentum. Many hedge funds now have losses for the year, which forces managers to take down both risk and leverage in anticipation of year-end outflows. I believe deleveraging is having a growing impact on marketplace liquidity around the world - and across asset classes. Yields are rising and spreads are widening throughout global fixed-income. Unstable equities markets around the globe are indicating a fragile liquidity backdrop. And this week's $2.68 (4.3%) drop in WTI has all the appearances of a major leveraged speculating community panic liquidation (portending challenges for the - to this point - resilient junk bond market).

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At this point, I seriously doubt the Fed has a solid grasp of the (direct and indirect) sources of the Trillions of global liquidity that have flooded into U.S. securities and asset markets over the past decade. I take them at their word that they don't discern the degree of leverage that would typically indicate a Bubble. Yet this has been the most atypical of global Bubbles. I am not convinced the Fed knows where to look for the leverage most germane to today's global Bubble. And, I'm compelled to add, the whole world seems oblivious. Speculative deleveraging is not on the Fed's radar, and this is a problem for the markets.

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iehi-feed-64384 Sun, 11 Nov 2018 20:53:07 GMT Dark Money: Illuminated http://implode-explode.com/viewnews/2018-11-11_DarkMoneyIlluminated.html Since dark money changed politics as we know it in the post-Citizens United era, the top 15 dark money groups have spent more than $600 million in secret money in our elections.

These groups accounted for more than 75 percent of the $800-plus million spent by all dark money organizations between January 2010 and December 2016. They spent the majority of this money on negative attack ads, criticizing candidates from the shadows while purposefully hiding their donors and masquerading as trade associations or "social welfare" nonprofits.

"Dark Money Illuminated" profiles the top 15 dark money groups and shines light on approximately 400 donors and donor organizations who have funded these groups, including companies, trade associations and labor unions. Issue One created a searchable, first-of-its-kind database containing nearly 1,200 transactions linked to these donors, each supported by primary source documents.''

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iehi-feed-64366 Wed, 07 Nov 2018 21:56:06 GMT Rudy Giuliani Claims He's Flat Broke After Making $9.5 Million Last Year http://implode-explode.com/viewnews/2018-11-07_RudyGiulianiClaimsHesFlatBrokeAfterMaking95MillionLastYear.html iehi-feed-64364 Wed, 07 Nov 2018 17:09:25 GMT Dow Rallies After Wall Street Cheers Midterm Results http://implode-explode.com/viewnews/2018-11-07_DowRalliesAfterWallStreetCheersMidtermResults.html iehi-feed-64357 Sun, 04 Nov 2018 16:27:04 GMT The Citizenship Clause Means What It Says http://implode-explode.com/viewnews/2018-11-04_TheCitizenshipClauseMeansWhatItSays.html ``Trump, Anton, and their enablers are relying on phony history and altered documents in an attempt to change the American constitutional order... Those who don't want to take my word for it can consult this essay by James C. Ho, a conservative "originalist" who was recently appointed to the U.S. Court of Appeals for the Fifth Circuit by Donald Trump. Ho and I agree on little except this: The citizenship clause means what it says.''

There's essentially no doubt it would take a constitutional amendment to change "birthright citizenship". A debate on that isn't unreasonable; what is unreasonable is Trump's belief he can change something so fundamental by fiat, illegally, in a way that explicitly end-runs around the core checks and balances of our government. There's definitely a word for that...

Besides, there is little evidence (if any) that "anchor babies" are creating an immigration problem. Immigrants will readily leave their US-born children behind, as US-born babies don't actually provide any "anchor" for the parents. So, what's the anger about? The kids who are born in the US? How are they not Americans?

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iehi-feed-64354 Fri, 02 Nov 2018 20:30:25 GMT Stocks fall after wild session as conflicting trade news keeps investors guessing http://implode-explode.com/viewnews/2018-11-02_Stocksfallafterwildsessionasconflictingtradenewskeepsinvestorsgu.html When asked whether the president explicitly requested his top advisors to drum up a trade deal, Kudlow said "no." ... Kudlow's remarks contradicted a Bloomberg report from earlier on Friday that said Trump had asked officials to prepare a draft for a U.S.-China trade deal.

"It's still all about trade," said JJ Kinahan, chief market strategist at TD Ameritrade. "Most of the trading we're seeing is related to earnings or trade."

"The recent moves we're seeing are reflect a return to more historical levels of volatility," said Kinahan. "I don't think this will abate."

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"Today's stronger than expected October employment report was a mixed bag for stocks," said Alec Young, managing director of global markets research at FTSE Russell. "On the positive side, strong job growth will allay fears of slowing economic growth. However, with wages up 3.1 percent year over year ... it will be more difficult for the Fed to slow its rate hiking campaign."

The Fed doesn't care about the economy "overheating" (especially since they know Trump would be pleased as punch about that) -- all the fundamental economic data does is provide them cover for (or an inconvenience with respect to) unwinding their giant post-crisis balance sheet.

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iehi-feed-64351 Wed, 31 Oct 2018 20:47:40 GMT ‘Godfather' of chart analysis says ‘damage done to the stock market' is much, much worse' than anyone is talking about http://implode-explode.com/viewnews/2018-10-31_Godfatherofchartanalysissaysdamagedonetothestockmarketismuchmuch.html Acampora cited a break down of so-called FANG stocks--a quartet of technology and internet-related companies that include Facebook Inc. FB, +0.16% Amazon.com Inc. AMZN, +0.12% Netflix Inc. NFLX, +5.59% and Google-parent Alphabet Inc. GOOGL, -0.05% --as the clearest sign that the worm has turned on the bull market.

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"I've been a bull for a long, long time and like everyone, I was waiting for a correction but this is something different," said Acampora, who many chartists refer to as the "godfather" of technical analysis.

"All the leadership is getting crushed," he said.

Acampora said he believed that the entire stock market itself would go into a bear market and said the current dynamic in the market was eerily similar to the stock-market crash of 1987, when the Dow slide a historic 22.6% in a single day on Oct. 19 of that year.

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Acampora isn't alone in his bearish view. Michael Wilson, Morgan Stanley's chief U.S. equity strategist, said he believes the market is undergoing a "rolling bear market." He was among the first to spot fractures in the market's uptrend.

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iehi-feed-64350 Wed, 31 Oct 2018 20:37:52 GMT Middle-class jobs fall short: 62% fail to support lifestyle in US http://implode-explode.com/viewnews/2018-10-31_Middleclassjobsfallshort62failtosupportlifestyleinUS.html Despite an unemployment rate that has reached a 50-year low of 3.7 percent, most jobs across the U.S. don't support a middle-class or better lifestyle, leaving many Americans struggling, according to a new study.

Sixty-two percent of jobs fall short of that middle-class standard when factoring in both wages and the cost of living in the metro area where the job is located, according to the study by Third Way, a think tank that advocates center-left ideas.

"There's an opportunity crisis in the country," says Jim Kessler, vice president of policy for Third Way and editor of the report. "It explains some of the economic uneasiness and, frankly, the political uneasiness" even amid the most robust U.S. economy and labor market since before the Great Recession of 2007 to 2009.

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Some areas, such as Myrtle Beach, fall short because of a scarcity of good-paying jobs. Among the biggest cities, Los Angeles, New York City and San Francisco were ranked fairly low (172nd, 168th and 174th, respectively) despite thriving economies because of their high cost of living.

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iehi-feed-64348 Wed, 31 Oct 2018 00:22:17 GMT Trump encouraged vulnerable consumers to invest in sham businesses, lawsuit says http://implode-explode.com/viewnews/2018-10-30_Trumpencouragedvulnerableconsumerstoinvestinshambusinesseslawsui.html iehi-feed-64343 Mon, 29 Oct 2018 17:11:30 GMT Gab, the Alt-Right Social Media Site, Gets Deplatformed http://implode-explode.com/viewnews/2018-10-29_GabtheAltRightSocialMediaSiteGetsDeplatformed.html Within the bounds of the law, net neutrality principles dictate that any internet user should be able to access Gab and upload garbage to it if they so please. Those are rights.

But that's probably where the list of rights ends. Hosting a website is a separate proposition from accessing one. A domain name, hosting servers, DDoS protection, and credit-card payment processing are not inherent rights of internet users, nor should they be. They entail ongoing, contingent agreements between separate parties; they are modern conveniences for those who adhere to the general social contract of not being an enormous asshole. The companies that pulled their support for Gab made it very difficult for the site to stay online, but they did not make it impossible. (There is an argument to be made that fundamental web services like domain registrars should be impartial, but given that the threshold for punitive action seems to be, roughly, "explicit Neo-Nazi online hangout," I'm not losing too much sleep, yet.) Gab is a terrible site with a higher-than-average proportion of racists, sexist, xenophobes, Islamophobes and anti-Semites, and nobody is obligated to specifically provide infrastructure support for them or maintain those business relationships in the face of public pressure.

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The era of tech companies playing dumb about who's harnessing their tools is coming to an end. This does not bode well for social media shitposters, and it also threatens to ensnare the less flashy infrastructure providers that gird small independent communities.

Gab is run by a bunch of naive kids who think "free speech" means "supporting assholes", and that all forms of speech should be protected (even if it threatens violence). Evidence of how well this works out in practice can be seen in the fact that Gab platform users have attacked some of the very execs of the platform (at least one of whom has been forced to leave).

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iehi-feed-64342 Mon, 29 Oct 2018 15:14:42 GMT The bright lights of market illusions are dimming http://implode-explode.com/viewnews/2018-10-29_Thebrightlightsofmarketillusionsaredimming.html Turn off the liquidity taps at the world's central banks and so does the ability of the market to believe seven impossible things before breakfast. That is why nearly all equity markets have had a horrible month. Almost all indexes are down -- by as much as 14 per cent over the last four weeks, and 24 per cent on the year. The only major markets in positive territory over a year are those in the US and Russia.

The surprising thing here is not so much that markets have tanked, but that, given that they are supposed to be discounting mechanisms, taking in and reacting rationally to all available information, it didn't happen sooner. US monetary tightening has not exactly been kept under wraps. The dual approach of cutting its asset holdings while hiking rates has been well advertised. The Chinese government's intention to attempt to deleverage has been no secret either. Nor has the tapering of quantitative easing in Japan or the intention of the European Central Bank to pull back from it completely. The ECB's asset purchases fell from €60bn a month in 2017, to €30bn in January, 2018. Its president, Mario Draghi, expects them to halve again in this quarter, with a view to ending them completely by the end of year.All this tapering and hiking might or might not be a good idea -- not everyone would necessarily want to tighten monetary policy in Europe at a time when the Germany economy is looking iffy and Italy is attempting to assert its fiscal sovereignty.

Whatever you think of it, there is no doubt that the liquidity lights, if not already off, have been dimming for some time. Suddenly what matters is not how much money is being printed, or when and where, but where we find ourselves in reality. In the case of stock markets, that means politics starts to matter again -- but, in the main, it means investors have to start focusing properly on cash and valuations.October shouldn't be seen as the end of the bull market (look at the annualised performance numbers for most markets and you will see that it ended some time ago). But this month can be recognised as the point at which the market shifts from being driven by liquidity to being driven by fundamentals

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iehi-feed-64340 Sun, 28 Oct 2018 19:34:57 GMT #TrollTracker: Twitter Troll Farm Archives http://implode-explode.com/viewnews/2018-10-28_TrollTrackerTwitterTrollFarmArchives.html On October 17, Twitter released an archive of over ten million tweets posted by accounts from 2013 through 2018. Of the total, over nine million tweets were attributable to 3,800 accounts affiliated with the Internet Research Agency, also known as Russia's infamous St. Petersburg troll factory. Over one million tweets were attributable to 770 accounts, originating from Iran...

The Russian and Iranian troll farm operations show that American society was deeply vulnerable, not to all troll farm operations, but to troll accounts of a particular type. That type hid behind carefully crafted personalities, produced original and engaging content, infiltrated activist and engaged communities, and posted in hyper-partisan, polarizing terms.

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iehi-feed-64338 Sun, 28 Oct 2018 14:41:31 GMT The Market Has Been on a "Sugar High"; With Massive Deficit-Driven Borrowing, Reality is Setting In http://implode-explode.com/viewnews/2018-10-28_TheMarketHasBeenonaSugarHighWithMassiveDeficitDrivenBorrowingRea.html The soaring deficit has been steroids for the US economy, but the government must borrow that money before it can spend it. That means that a trillion dollars a year is now hitting, and will continue to hit the market in massive quarterly waves for years. And the money isn't there to absorb it without prices falling drastically. That means lower stock and bond prices and higher bond yields.

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On October 15, the Trump Regime confirmed all of those warnings when it announced that the fiscal year 2018 budget deficit had blown out to $779 billion, with the tax cut and Budget Busting Agreement impacting only the last 8 months of that period. For the first 4 months of the fiscal year, tax revenues were higher, at the old higher rates, and spending was less than now.

For the first full calendar year after those two laws were went into effect, we can expect the deficit to exceed a trillion dollars. That means an average of $80-90 billion per month in new Treasury supply.

... this month the dam broke as Treasury supply returned to the market in a huge wave in the first two weeks of October. The markets were not able to smoothly absorb that onslaught of supply.  That onslaught will continue as tax collections will be seasonally weak until the next quarterly tax due date in mid-January. Until then, a gargantuan wave of supply is coming that will repeatedly buffet the markets.''

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iehi-feed-64331 Fri, 26 Oct 2018 02:57:15 GMT Trump Foundation lawsuit: New York judge grills Trump lawyers about foundation's ties to campaign http://implode-explode.com/viewnews/2018-10-25_TrumpFoundationlawsuitNewYorkjudgegrillsTrumplawyersaboutfoundat.html The Trump Foundation is accused of giving control of money raised during the televised Iowa fundraiser -- held during a debate that Mr. Trump skipped -- to his campaign, which would be a violation of New York laws governing how private foundations operate.

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"During that fundraiser, did he speak about his campaign?" she asked. Futerfas replied, "Yes."

"So it wasn't just a fundraiser," Scarpulla observed, saying it was also a political event.

"He was certainly there as a candidate. Let's put it that way," Futerfas said.

That same month the foundation's treasurer Allen Weisselberg emailed then-Trump campaign manager Corey Lewandowski, writing, "we should start thinking about how you want to distribute the funds collected." Weisselberg is also chief financial officer of the Trump Organization.

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iehi-feed-64321 Tue, 23 Oct 2018 22:00:33 GMT GOP Tax Cut Deficits: A Good Thing For the Economy? (NOT SO FAST!) http://implode-explode.com/viewnews/2018-10-23_GOPTaxCutDeficitsAGoodThingFortheEconomyNOTSOFAST.html You often hear people complain that deficits are "evidence of overspending." It's taken as de facto proof that the government is behaving "irresponsibly" or "living beyond its means." But economists know (or should know) better. It is inflation (not deficits) that signals overspending. And what does CBO have to say about that? The answer is shown here.

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So let's remember that a deficit is merely evidence that the government is putting more money into the economy than it is removing via taxation. Thus, looming trillion-dollar deficits are a prediction that the government will be making trillion-dollar deposits to the broader economy beginning in 2020. Is that something to be up in arms over?

Woah, woah, woah -- hold on there! Yes, it's certainly true that inflation isn't manifesting right now, and perhaps won't, for the foreseeable future. But the second paragraph, stating that the deficits are like "depositing money into the economy", is just gobbledeygook! The government isn't taking this deficit money out of a "savings account" and just plopping the lucre into the economy -- the increased deficit is coming from more borrowing. This should be a cosmic "duh", but this eek-con-o-missed writer doesn't see it. At a minimum, this means that as much cash is being hoovered up by the government as is being "added" to the economy, so the additional deficits are, at best, a zero-sum.

Now, you might reply, "ok, more deficits, who cares? After all, the smart eek-con-o-missed says inflation is the only concern, and there's none of that happening." Well, larger deficits should be at least as much a concern as whether inflation is manifesting, for at least two reasons: (1) as a result of these additional deficits, it is all the more likely that there might, someday soon, need to be higher taxes to pay these creditors back, and/or (probably more likely), a debt default, and (2) many of these creditors are foreign, and they might as a result be able to exert increasing leverage over our country (leading to, e.g., exacerbation of nationalist "blowback", among other ills. Of course, such a thing could never happen...)

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iehi-feed-64307 Thu, 18 Oct 2018 23:07:01 GMT Trump May Have Intervened in FBI HQ Decision To Protect His Hotel http://implode-explode.com/viewnews/2018-10-18_TrumpMayHaveIntervenedinFBIHQDecisionToProtectHisHotel.html iehi-feed-64304 Thu, 18 Oct 2018 19:46:31 GMT Fed points to more rate hikes amid criticism from Trump http://implode-explode.com/viewnews/2018-10-18_FedpointstomoreratehikesamidcriticismfromTrump.html Federal Reserve officials remain convinced that continuing to gradually increase interest rates is the best formula to preserve a steady economy, according to minutes released Wednesday of the central bank's most recent policy meeting. That may not please President Donald Trump, who has been vocal in his criticism of the central bank's actions.

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Another development from the last meeting saw the committee remove the word "accommodative" from its description of the future policy path. In a post-meeting news conference, Powell told reporters not to read too much into the move, but the minutes provided more detail on why the FOMC decided to change the language.

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