October 30: Daily Contrarian Reads

China's Minsky Moment----The Uber Question

This long-term warning coincides with my belief that over the short term, the risks are all to the downside. I have been banging the drum on the fact that the Chinese government have done everything in their power to keep markets stabilized through their Communist Party Congress. They haven’t even hidden this fact. From the big sign above the Shenzhen Securities Exchange building that read “Use every effort to protect the stability of stock market for 20 days,” to the recent release that the Chinese government has asked firms to delay bad result during Congress, the message is clear.

When Market Trends Break, Even Borderline Data Is Recessionary

So once market action breaks from a long-term uptrend, watching measures of economic activity becomes that much more important. To demonstrate this, there are two sets of companion charts below. The first chart shades periods where a given economic indicator is at or below its current level. The second chart restricts the shading to periods where the economic data is at or below its current level and the stock market has broken its 12-month moving average. Also plotted on each chart is the S&P 500 on a log scale and US recessions, both since 1950.

How We Learned Not To Care About America's Perpetual Wars

Consider, if you will, these two indisputable facts.  First, the United States is today more or less permanently engaged in hostilities in not one faraway place, but at least seven. Second, the vast majority of the American people could not care less.

The Informant Cometh

The broad outlines of Uranium-Gate are already loaded like a platter of nachos grandes with interesting tidbits of suspicious detail. The informant worked for a DC Swamp lobbying firm that was hired by Tenex, a subsidiary of the Russian government-owned company Rosatom, to grease the skids for a deal to buy a Canadian company, Uranium One, which had substantial mining operations in the USA. According to The Hill website, the deal put about 20 percent of US uranium into the hands of the Russian company. This was in 2010.

Q3 GDP: Exactly What Strong Growth?

What the Q3 2017 advance GDP report confirms is what we already know, more evidence against using binary, traditional business cycle models. The economy remains stuck, dragged down overall the last decade by “something”, some great anchor that doesn’t allow even the most basic of cyclical impulses to get everything moving in the right direction with powerful momentum. Instead, it’s “expansion” continues to proceed unevenly, lurching between, again, slight downturns and slackening upturns. This latest upturn is the slightest one yet, but it isn’t being talked about that way because Economics wants desperately to be right rather than correct.

Catalonia and Spain Enter Dangerous Uncharted Territory

Today was one of the strangest days of my life. I woke up in a constitutional monarchy called Spain and will go to bed, the same bed, in a newly proclaimed republic. Catalonia’s impossible dream has finally come true, but it could be extremely short lived, and it could have very damaging long-lasting consequences.

Don't Call It Tax Simplification----The Potential Morass Of The 25% Pass-Thru Rate

The third guardrail option, as Greenberg describes, is to impose "a holistic, 'facts and circumstances' test to determine how much income needs to be categorized as wages." When tax lawyers and accountants hear the phrase "facts and circumstances," what they hear is themselves getting rich. The idea under this approach is we’d let professionals at the IRS work things out with taxpayers' lawyers and accountants on a case-by-case basis by balancing the results of a variety of qualitative and quantitative tests.

RussiaGate Breeds “Establishment McCarthyism”

This extraordinary assault on civil liberties is cloaked in fright-filled stories about “Russian propaganda” and wildly exaggerated tales of the Kremlin’s “hordes of Twitter bots,” but its underlying goal is to enforce Washington’s “groupthinks” by creating a permanent system that shuts down or marginalizes dissident opinions and labels contrary information – no matter how reasonable and well-researched – as “disputed” or “rated false” by mainstream “fact-checking” organizations like PolitiFact.

The FBI's Forgotten Criminal Record

President Trump’s firing of FBI chief James Comey on May 9 spurred much of the media and many Democrats to rally around America’s most powerful domestic federal agency. But the FBI has a long record of both deceit and incompetence. Five years ago, Americans learned that the FBI was teaching its agents that “the FBI has the ability to bend or suspend the law to impinge on the freedom of others.” This has practically been the Bureau’s motif since its creation in 1908.

Alarm Sounds In UK----High Street Sales Are Crashing

High street sales are falling at their fastest rate since the height of the recession in 2009 as struggling households put the brakes on spending, according to a survey that is a grim omen for struggling retailers this Christmas. The CBI’s closely watched survey recorded a “steep drop” in retail sales in October. The slump sent shockwaves through the high street, with the CBI’s chief economist, Rain Newton-Smith, warning of a “softening” of demand as inflation ate into Britons’ spending power. Department stores and specialist food and drink outlets bore the brunt of the spending slowdown.

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