Financial sources feeds


One of the key questions to emerge from Elon Musk's going private "funding secured" fiasco, is where was the board before, during and after the series of torrid tweets sent out by the Tesla CEO in the past two weeks.  In an overnight NYT article, we finally get a fairly clear picture of what was going on through the heads of the company's board of directors, and it's not pretty.

While we urge readers to skim the full piece here, below are some of the key soundbites in what appears to be the first step in the board throwing Musk under the bus as defense against a potentially destructive SEC probe that could have vast implications not only for the CEO, but the company in general.

First, it appears that a big rift has emerged between Musk and the Board, to wit: "Members of Tesla’s board are scrambling to control a chief executive who some directors think is out of control."

The key issue: the same one that was brought up by a key Tesla investor over a month ago, with no success: getting Musk to shut up.

In recent days, according to people familiar with the matter, some of his fellow board members delivered a stern message: Stop tweeting.

Mr. Musk hasn’t heeded that advice. He has continued to post messages on Twitter, publicly plotting the company’s strategy and in some cases making assertions of dubious accuracy. That has only added to the chaos engulfing the struggling company.

But more concerning for Musk is that the Board, which previously endorsed Musk's confusing narrative of events with a brief statement that effectively confirmed what we now know never happened, namely that the funding was never "secured", is now building a firewall from the CEO's increasingly toxic tweets:

Tesla’s board members are also racing to inoculate themselves from the possible fallout from Mr. Musk’s public statements.

While it’s standard for boards to retain lawyers to counsel them on complicated matters, Tesla’s outside directors have hired two law firms to represent them.

Some of the especially colorful words that emerge from the report: "alarmed", "blindsided", "erratic":

Some members of the board have grown alarmed by what they see as Mr. Musk’s erratic behavior, according to three people familiar with some directors’ thinking. Directors were blindsided last week when Mr. Musk claimed on Twitter that he had “funding secured” for a possible deal to convert Tesla from a publicly traded company into a private one. Such a transaction would most likely cost well over $10 billion.

A discussion of what Musk knew when only solidifies the case that Musk's only intention was to burn the shorts:

Musk said this week that he has been in talks with Saudi Arabia’s main government investment fund about possibly working on a deal to take Tesla private. But there were no indications that Mr. Musk has actually nailed down any commitments to bankroll such a transaction, and the Securities and Exchange Commission last week contacted the company about Mr. Musk’s Twitter posts, which drove up the company’s shares and prompted a halt in trading.

The NYT then focuses on the composition of the "independent" board, highlighting that it is anything but, which will be an issue as part of the company's attempts to take itself private.

One independent director’s personal relationship was deemed too close for him to sit on a committee the board established to evaluate Mr. Musk’s potential going-private transaction, according to two people familiar with the matter. As a result, that key committee only has three members.

Meanwhile, as Musk's erratic behavior has stunned investors, the board has similarly been shocked by how Musk forced it to do damage control for him.

“The issues facing Tesla relate to a lack of operational maturity,” said Roger McNamee, a Silver Lake founder who is now a managing director of the private-equity firm Elevation Partners. “The market has been remarkably patient as Tesla struggles to scale its manufacturing.” That patience has been tested by Mr. Musk in recent months. He has publicly disparaged financial analysts and insulted a cave diver who was helping rescue members of a Thai soccer team.

Board members’ frustrations have intensified in recent days.

Directors were upset that Mr. Musk’s tweets forced them to rush out a public statement explaining a transaction that was at an embryonic stage, according to people familiar with the thinking of board members.

So where would the growing feud between the board and Musk get resolved? Apparently, on twitter, where Musk's behavior will determine if he is paying attention or courting disaster:

Multiple directors have recently told Mr. Musk that he should stop using Twitter, with one urging him to stick to building cars and launching rockets, according to people familiar with the board’s communications. Tesla employees, including the company’s public-relations staff, have echoed that point, another person said.

Which brings up a bigger question: just how loose is board oversight of its CEO, and why did it take an SEC probe into the company to force directors to start taking the company's current problems seriously? Or does the board know something investors don't, and is "scrambling" to take measures to distance itself from its wayward CEO?

For the answer keep an eye on Musk's tweeting, which as we noted recently has spiked exponentially in recent months, in what appears to be a desperate diversion from "something else."

Judging by the board's response, that "something" could be far more damaging to the company than anything revealed so far.

The full NYT article can be read here.

Author: Tyler Durden
Posted: August 15, 2018, 12:10 pm

On any other day, today's surge in the Turkish Lira would have been sufficient to prompt a sharp rebound in global risk and euphoria across emerging markets as "the Turkey contagion was contained." But not today, for a few main reasons: first, the spike in the Lira was due not to improving fundamentals but as a result of another soft capital control: the local banking regulator announced that the total amount of foreign currency and lira swap and swap-like transactions can’t exceed 25% of banks’ legal shareholder equity (which followed a similar determination at 50% just two days earlier). The logic behind the move, taken straight out of the PBOC's playbook: to "kill offshore lira liquidity to stop foreigners shorting the lira" as Blue Bay's Timothy Ash noted.

And while the crackdown on shorts worked initially, sending the USDTRY sliding as much as 7% below 6.00, traders are aware that these moves have at beast a very short term impact, and a resumption in the Lira's slide is virtually assured, especially after a Turkish judge rejected a release request from US pastor Brunson while Erdogan announced new tariffs on US imports, guaranteeing that the diplomatic feud with Erdogan will get worse in the next few days.

As a result, despite the lira's temporary strength, U.S. equity futures slumped to session lows following declines in both Europe and Asia on Wednesday as risk appetite continued to be tested. Futures on the Dow, Nasdaq and S&P 500 all pointed to a lower open.

Treasuries climbed, with the 10Y yields sliding below 2.90%, while the dollar surged to the highest level in 14 months, sucking liquidity out of emerging markets and sending industrial metals sliding: the Bloomberg Dollar Spot Index rose a fifth day, up 0.2% to highest level since June 2017.

“In light of all the turmoil we’ve seen out of Turkey and the subsequent contagion into other emerging markets, the dollar is pretty much establishing itself as the safe-haven currency,” said Bart Wakabayashi, Tokyo branch manager at State Street Bank. "If you are going to park your money somewhere to stay away from the turmoil, the dollar is going to be the currency of choice."

And with the dollar surging, what spooked traders today was not so much Turkey but China, where the Yuan tumbled to new one year lows, with the USDCNH rising above 6.92 while the onshore yuan also fell below 6.900 per dollar, its lowest level since May 2017.

Elsewhere, Hong Kong intervened for the second time in three months overnight to defend its peg to the after the local currency fell to the weak end of its trading band. However, with the PBOC refusing to intervene and halt the Yuan's drop, and with traders expecting more trade war retaliation from Trump, the Shanghai Composite was a straight diagonal lower, closing 2.1% lower - down for a 3rd day - and just above the lowest level set for 2018.

The strong dollar’s victims are of course emerging currencies, with many remaining under pressure despite the lira’s recent bounce. But the greenback’s rise has also pummelled euro and sterling. There was another key factor in today's EM rout: China's Tencent tumbled after reporting disappointing earnings, missing on both the top and bottom line:  Tencent (0700 HK) quarterly net profit of CNY 17.867bln vs. Exp. CNY 19.3bln (Prev. CNY 18.231bln), revenue CNY 73.675bln vs. Exp. CNY 77.7bln (Prev. CNY 56.606bln). And with a weight eight times (4.9%) that of Turkish stocks, this one Chinese company pulled down the EM index.

Overall, Asian shares ex-Japan slid more than 1% to one-year lows while MSCI’s all-country equity benchmark was a quarter percent lower but it stayed off one-month lows reached on Monday.

After a positive start to the European session, where volumes were muted and liquidity was drained due to the Assumption Day public holiday, raw material producers pulled the Stoxx Europe 600 Index down as industrial metals such as copper and zinc falling to the lowest in more than a year, with copper on the verge of a bear market.

As Bloomberg adds, with the US bull market just one week away from becoming the longest in historym investor caution remains amid thin summer trading, and as trade tensions between China and the U.S. linger.

"I think we have not seen the worst of it yet,” Peter Tchir, Academy Securities head of macro strategy, said on Bloomberg Television. “You’ve only started to see a knock-on effect. I think this is truly the eye of the storm and we are going to get another round of emerging-market weakness.”

Elsewhere in FX, the pound tumbled under $1.27 for the first time since June 2017, having lost ground for 11 days in a row, its longest losing streak since 2008. The currency is being undermined by confusion around what trade deal it (the British government) will negotiate with the European Union ahead of Britain's planned exit next year from the bloc.

Price increases were boosted by the cost of auto fuel, transport tickets and computer games. The Aussie and Kiwi were sold against the dollar as liquid proxies to the Turkish lira and South African rand. The yen dropped a second day against the dollar while Japan’s 10- year bond yields edged lower after the central bank refrained from cutting purchases.

There was more "evasive action" by various Central Banks and authorities to stem the capital flight, with an ‘unexpected’ Indonesian rate hike - the fourth time since May - accompanied by further measures or verbal pledges to inject liquidity and contain excessive price action/speculative attacks. However, many regional currencies have lost recovery momentum and handed back a chunk of Tuesday’s recovery gains if not more in some cases.

Oil fell on inventory increases and as Libya’s output climbed. The crude complex has continued the pullback seen in yesterday’s trade that was exacerbated by a surprise build in API crude inventories, with Brent and WTI breaking though the USD 72/BBL and USD 67/BBL levels to the downside.

Taking a look at metals, all of zinc (-2.2%), lead (-1.9%) and gold (-0.5%) are down with the yellow metal below the USD 1190/OZ level, as the rising USD is hitting the metals sector as a whole. Gold, the other traditional safe haven, sank to 18-month lows, also hurt by dollar strength.

“The dollar will continue to be the safe-haven asset of preference. As a consequence, gold prices are really going to struggle,” said Daniel Hynes, an analyst at ANZ Bank.

Copper is also down about 2% on the day and has hit a 13 month low, with the construction material hammered by the Escondida copper mine union stopping a strike amid a new contract offer.

Economic data include retail sales, industrial output and Empire State manufacturing survey. Cisco, NetApp and Macy’s are due to report earnings.

Market Snapshot

  • S&P 500 futures down 0.1% to 2,838.25
  • STOXX Europe 600 up 0.07% to 385.19
  • MXAP down 1% to 161.48
  • MXAPJ down 0.9% to 521.57
  • Nikkei down 0.7% to 22,204.22
  • Topix down 0.8% to 1,698.03
  • Hang Seng Index down 1.6% to 27,323.59
  • Shanghai Composite down 2.1% to 2,723.26
  • Sensex up 0.6% to 37,852.00
  • Australia S&P/ASX 200 up 0.5% to 6,329.02
  • Kospi up 0.5% to 2,258.91
  • German 10Y yield unchanged at 0.328%
  • Euro down 0.1% to $1.1333
  • Brent Futures down 0.7% to $71.95/bbl
  • Italian 10Y yield fell 7.1 bps to 2.758%
  • Spanish 10Y yield fell 0.5 bps to 1.409%
  • Gold spot down 0.5% to $1,188.14
  • U.S. Dollar Index up 0.05% to 96.78

Top Overnight News from Bloomberg

  • A Turkish court refused to release U.S. pastor Brunson: Hurriyet
  • Major Turkish companies, financial institutions and the government have at least $16 billion in bonds denominated in foreign currency that are due by the end of next year, data compiled by Bloomberg shows
  • President Donald Trump “has a great deal of frustration,” his spokeswoman said, calling again on Turkish President Recep Tayyip Erdogan to release an American pastor and other U.S. citizens as a diplomatic standoff continued to weigh on global financial markets
  • The franc’s recent appreciation against the euro highlights how frail financial markets still are, Swiss National Bank Vice President Fritz Zurbruegg said
  • Trade conflict impact on China’s industrial production, employment and consumer prices will be “controllable”, National Development and Reform Commission spokesman Cong Liang says at a briefing
  • Russia’s central bank, one of a handful in Europe to cut interest rates this year, could increasingly consider a hike after the ruble slumped following the latest U.S. sanctions and the risk of more to come
  • Hong Kong intervened to defend its peg to the dollar for the first time in three months after the local currency fell to the weak end of its trading band. The Hong Kong Monetary Authority bought HK$2.159 billion ($275 million) of local dollars during New York trading hours on Tuesday, according to the de facto central bank’s page on Bloomberg
  • China is able to weather the escalating trade war with the U.S. and achieve its economic targets for this year, an official at the nation’s top economic planning body said
  • New Zealand’s government will ban foreigners from buying residential property, making good on its promise to crack down on offshore speculators who it says are partly to blame for spiraling house prices
  • Indonesia’s central bank surprised most economists by raising its benchmark interest rate a fourth time since May, moving swiftly to contain the volatility sweeping across emerging markets and curb a slide in its currency

Asian equity markets were mostly negative. Nikkei 225 (-0.7%) weakened amid profit taking following the prior day’s gains of over 2%, while ASX 200 (+0.4%) remained afloat on technical buying as the index reclaimed the 6300 level but with upside capped by losses in financials as Australia’s largest lender CBA suffered on criminal misconduct allegations. Elsewhere, Shanghai Comp. (-2.0%) saw hefty losses and the Hang Seng (-1.5%) declined to its lowest in around a year in a continuation of the recent underperformance as Tencent and tech names remained pressured, while the PBoC skipped reverse repo operations for a 19th consecutive occasion and although it later announced CNY 383bln in 1yr MLF loans, this was still lower than its previous MLF operation of CNY 502bln in late July. Finally, 10yr JGBs were marginally higher with only minimal support seen amid the profit taking seen in Japanese stocks and BoJ’s presence in the market in which the central bank kept its purchase amounts unchanged. PBoC refrained from reverse repos but announced to lend CNY 383bln through 1yr Medium-term Lending Facility.

Top Asian News

  • Dollar-Yen Carry Trade Just Got More Alluring, Thanks to BOJ
  • Chinese Hot Pot Chain Said to Seek Approval for $1 Billion IPO
  • China Is Said to Suggest New Bidding Limits for Special Bonds
  • China Gas Stocks Slump as Margin Risks Take Sheen Off 2018 Rally

European equities have started the day marginally positive in a news-thin day as certain European bourses, including the FTSE MIB, are shut due to a public holiday. The metals sector is slightly underperforming on softer base metals prices, with the Stoxx 600 basic resources index breaking its July-low support level to the downside. The day has been dominated by earnings news flow, where Admiral Group (+4.2%) and Vestas Wind Systems (+7.5%)  eat on expectations and are leading the gains in the Stoxx 600. William Demant (-7.2%) missed on expectations, however, and are at the foot of the Stoxx 600

Top European News

  • Highway Managers Must Resign After Bridge Collapse, Italy Says
  • Credit Agricole Recommends Buying EUR/CHF on Possible SNB Action
  • Nordic Funds Prove Haven in $56 Billion Europe Stock Drain
  • South African Police Have Asked Interpol to Help With Steinhoff

In FX, Turkish Lira moves and Turkish news remain firmly in the spotlight, as other EM currencies continue to trade in lock-step and contagion spreads via the Usd through the G10 community. Indeed, the DXY climbed to fresh 2018 highs just shy of 96.900 (96.878 to be precise) when the Try retreated towards 6.6000 vs the Dollar and duly eased back when the pair breached 6.0000 to the downside before another bounce on headlines reporting that a Turkish Court has rejected a US appeal against the house arrest of Pastor Brunson – Usd/Try circa 6.2000 at writing. EM - Lots more evasive action by various Central Banks and authorities to stem the capital flight, with an ‘unexpected’ Indonesian rate hike accompanied by further measures or verbal pledges to inject liquidity and contain excessive price  action/ speculative attacks. However, many regional currencies have lost recovery momentum and handed back a chunk of Tuesday’s recovery gains if not more in some cases. NZD/CHF - Bottom of the heap of majors, with the Kiwi only just hovering above 0.6550 vs its US counterpart and back below 1.1000 vs its antipodean peer despite extended AUD weakness alongside the YUAN by official and free-float market forces (Cny and Cnh both under 6.9000 vs the Usd and revisiting line in the sand intervention territory). On that note, the SNB appears to have reached its tolerance limit with the Franc and as suspected reiterated the need for ZIRP and FX intervention to curb Chf demand and stabilise fragile FX developments. Usd/Chf rebounding as a result towards parity and Eur/Chf close to 1.1300 vs 1.1275 at one stage

In commodities, the crude complex has continued the pullback seen in yesterday’s trade that was exacerbated by a surprise build in API crude inventories, with Brent and WTI breaking though the USD 72/BBL and USD 67/BBL levels to the downside. Taking a look at metals, all of zinc (-2.2%), lead (-1.9%) and gold (-0.5%) are down with the yellow metal below the USD 1190/OZ level, as the rising USD is hitting the metals sector as a whole. Copper is also down about 2% on the day and has hit a 13 month low, with the construction material hammered by the Escondida copper mine union stopping a strike amid a new contract offer Iranian Oil Minister to attend JMMC meeting in Algeria in September

Looking ahead to today, we will get a series of US data releases: July retail sales, industrial production, manufacturing production and capacity utilization data along with August empire manufacturing, and preliminary Q2 nonfarm productivity and unit labor costs, June business inventories and August NAHB housing market index. Macy's will be reporting earnings.

US Event Calendar

  • 7am: MBA Mortgage Applications, prior -3.0%
  • 8:30am: Empire Manufacturing, est. 20, prior 22.6
  • 8:30am: Nonfarm Productivity, est. 2.4%, prior 0.4%; Unit Labor Costs, est. 0.0%, prior 2.9%
  • 8:30am: Retail Sales Advance MoM, est. 0.1%, prior 0.5%;
    • Retail Sales Ex Auto and Gas, est. 0.4%, prior 0.3%
    • Retail Sales Control Group, est. 0.4%, prior 0.0%
  • 9:15am: Industrial Production MoM, est. 0.3%, prior 0.6%; Capacity Utilization, est. 78.2%, prior 78.0%
  • 10am: Business Inventories, est. 0.1%, prior 0.4%
  • 10am: NAHB Housing Market Index, est. 67, prior 68
  • 4pm: Total Net TIC Flows, prior $69.9b; Net Long-term TIC Flows, prior $45.6b

DB's Jim Reid concludes the overnight wrap

President Erdogan and Finance Minister Albayrak gave speeches that doubled down on the confrontational message and  gave no indications of a positive resolution to the current political standoff with the US over American pastor Brunson’s house arrest. President Erdogan vowed to boycott American electronics, specifically expressing a desire to ban iPhones in favour of Samsung phones without giving details of when and how. Elsewhere, Turkey’s five-year CDS spreads tightened as well, falling 67.5 basis points, and 10- year sovereign bonds rallied 94 basis points. The strong moves were somewhat surprising, given the lack of concrete policy action by Turkish officials, although an easing of contagion fears, the central bank’s pledge of liquidity if required as well as Reuters reports of a potential conference call on Thursday where Finance Minister Albayrak will seek to reassure investors may have helped too.

Broader emerging market currencies performed well in line with the lira yesterday, especially those that had declined in unison over the last few sessions. The South African rand and Argentine peso gained 1.19% and 0.73% against the dollar, respectively. The Mexican peso also gained 1.24%, causing the trade-weighted dollar to close around flat. The DXY index, however, gained 0.35% to the strongest level since June 2017, as developed market currencies depreciated. The yen shed -0.41% but remains in its recent range, but the euro declined -0.58% to its weakest level in over a year and fell below its 200-week moving average.

This morning in Asia, the Turkish Lira is resuming its decline (-2.2%) and equities are broadly lower with the Hang Seng (-1.52%), Shanghai Comp. (-1.31%) and Nikkei (-0.85%) all down. Meanwhile, futures on the S&P are marginally lower while yields on UST10y are c2bp lower. As for data, China’s July new home prices grew to the highest in c2 years, up +1.2% mom and +6.6% yoy (vs. 5.8% in June). Elsewhere, Reuters cited an unnamed White House official who warned more economic pressure may be placed on Turkey if it refuses to release the American pastor.

Back to yesterday, the dollar’s recent strength is weighing on commodity prices. Brent crude oil failed to rally again yesterday, paring intraday gains of as much as 1.82% after news broke that India may cut oil imports from Iran by 50% to satisfy a US waiver. Countries like India are potentially the swing purchasers for Iranian oil; if they decide to follow US sanctions it will likely remove Iranian oil from the global market. The broader commodity complex was lower as well, with the bellwether CRB raw industrials index dipping to its lowest level of the year.

Front month copper futures fell 1.78% to their lowest level since last July. In the US, risk sentiment improved and the S&P 500 posted its first gain in the last five trading session, rising +0.64%. Banks led gains, rallying +1.04%, but they nevertheless remain -0.38% lower since their level before Turkey-related volatility intensified on Friday. Similarly, the VIX index fell 1.5 points but remains 2.4 points higher over the last week. Sectorally, cyclical sectors outperformed, with consumer discretionaries rallying 0.95% and utilities lagging behind. Treasuries sold off slightly but the 10-year yield ended the session broadly flat.

European equities failed to join the global rally yesterday, with the Euro Stoxx 600 closing flat. The weaker euro did not provide a tailwind, with the correlation between the single currency and the Stoxx 600 recently turning positive for the first time since last summer. Usually, a weaker euro boosts European exporters and increases the value of overseas earnings. Fixed income price action was firmer, with the IG and XO iTraxx indexes rallying 0.9bp and 2.4bp, respectively. German bund yields sold off slightly, in line with Treasuries, but peripheral spreads rallied notably. Italian two- and ten-year spreads to Germany closed 9 and 8.7 basis points tighter, respectively. This partially reflects the improved price action out of Turkey, but could be in response to more positive developments surrounding the upcoming Italian budget. Ansa reported that Prime Minister Conte and top ministers agreed that they will need to cut the debt stock moving forward.

Staying with Italy, ANSA also has reported that a 50-year old suspension bridge in Northern Italy has collapsed and led to at least 26 casualties. Following on, the Deputy Premier Salvini has signalled that EU rules should not hold back investments as he noted “there can be no trade-off between fiscal rules and the safety of Italians” while adding that “if external constraints prevent us from spending to have safe roads…then it really calls into question whether it makes sense to follow those rules”.

Moving onto Brexit where the German Chancellor Merkel may be suggesting a more flexible approach to Brexit talks. She noted that “hopefully it’ll not come to an unregulated Brexit, but rather to a reasonable negotiated agreement”, although she added that the UK has to “commit to re-accepting EU rules”. Earlier on, the UK Foreign Secretary Hunt noted that “we need a change in approach by the EC if we’re going to have a pragmatic deal that works for everyone”.

Before we take a look at today’s calendar, we wrap up with other data releases from yesterday. In the US, the July NFIB small business optimism index nudged up 0.7pts mom to a fresh 35 year high (107.9 vs. 106.8 expected). Respondents were more optimistic about the general economy, hiring and prospects for employee compensation.

In Europe, Germany’s 2Q GDP was above market at 0.5% qoq (vs. 0.4% expected), while prior data revisions have led to an annual growth of 2.0% yoy (vs. 2.1% expected). The German statistical office indicated that consumption and investment had contributed positively. Elsewhere, the second reading of the Euro area’s 2Q GDP was revised 0.1ppt higher to 0.4% qoq and 2.2% yoy, while the final reading of Germany and France’s July CPI was confirmed at 2.1% and 2.6%, respectively. Meanwhile, the August ZEW survey indicated respondents were less pessimistic this month, with the expectations index for Germany (-13.7 vs. -21.3 expected) and the Euro area (-11.1 vs. -18.7 previous) both improving and now at the highest levels since May. Back in the UK, the June unemployment rate fell to a 43-year low, down 0.2ppt mom to 4.0% (vs. 4.2% expected) while the employment change was below market at 42k in 2Q (vs. 93k  expected). Lastly, the average weekly earnings growth (ex-bonus) nudged down one tenth to an inline print of 2.7% yoy.

Looking ahead to today, we will get a series of US data releases: July retail sales, industrial production, manufacturing production and capacity utilization data along with August empire manufacturing, and preliminary Q2 nonfarm productivity and unit labor costs, June business inventories and August NAHB housing market index. Macy's will be reporting earnings.

Author: Tyler Durden
Posted: August 15, 2018, 11:28 am

The suspect arrested on suspicion of carrying out a terrorist attack at the UK Parliament on Tuesday has been named as Salih Khater, Sky News reported. It is believed the 29-year-old is a British citizen of Sudanese origin, and remains in police custody after his arrest on suspicion of preparing an act of terror.

Westminster attack suspect Salih Khater

A Facebook page for a man of the same name says he lives in Birmingham, works as a shop manager, and has studied at Sudan University of Science and Technology.

Khater has been arrested on suspicion of ramming a car into pedestrians and cyclists before crashing into security barriers outside the Houses of Parliament. The suspect is being held in custody in south London, and is said to be not cooperating with police. Scotland Yard’s head of counter-terrorism Neil Basu said no other suspects have been identified.

Police have been searching addresses in the Midlands after a car smashed into barriers near Parliament on Tuesday morning. Officers revealed the driver travelled from Birmingham to London on Monday night and arrived in the capital just after midnight.

He remained in the Tottenham Court Road area, close to Oxford Street, from around 1.25am until 5.55am.

The silver Ford Fiesta was then driven to Westminster and Whitehall for about 6am and stayed in the area until the time of the attack. It hit cyclists and pedestrians at 7.37am before crashing into security barriers.

According to the MI5, the suspect was unknown and "not currently cooperating", the Metropolitan Police said afterwards. His vehicle was removed late on Tuesday night.

Two addresses in the West Midlands city were being searched by counter-terror officers later that evening, as well as a flat in Nottingham's Radford/ Arboretum area.

* * *

It was the second terrorist attack on the Houses of Parliament in just under 18 months. The first one in March last year claimed the lives of five people, including a police officer. In a third incident, an attempted attack was foiled when counter-terrorist officers arrested the potential assailant, who was found outside parliament in possession of three knives.

A man and a women were taken to hospital with non life-threatening injuries after the vehicle hit cyclists in rush hour, but they have now been discharged. Witnesses described how the car came "whipping round the corner" and drove through about a dozen cyclists.

Robert Nicholson told Sky News he saw the incident unfold as he was waiting in a "safe cycling box" near Parliament. He chased the car after the impact left one woman flying up "onto the bonnet" and snapped the frame of one of the bikes.

Assistant Commissioner Neil Basu said: "There is no intelligence at this time of further danger to Londoners or to the rest of the UK connected to this incident."

Author: Tyler Durden
Posted: August 15, 2018, 10:45 am

In a day in which the dollar set new highs against all emerging market pairs and global risk was on the defensive, the Turkish Lira bucked the trend and extended its rapid rebound from record lows, after Turkish regulators imposed new "soft capital controls" to prop up the battered currency, making it even harder for banks to short the currency through the swap market.

One day after Turkey suspended mark-to-market for banks in a bid to offset fears about debt rollover and capital shortfalls, the Ankara-based Banking Regulation and Supervision Agency (BDDK) announced that the total amount of foreign currency and lira swap and swap-like transactions can’t exceed 25% of banks’ legal shareholder equity; the announcement came just 48 hours after a 50% was imposed on Monday, which however failed to make much of a dent in the selloff.

The latest move limits funds’ access to lira liquidity in the offshore swap market and makes it harder for them to borrow the currency from local lenders and short it. The rate on overnight dollar-lira swaps surged more than 12% points to 34.5%, the highest level since 2003.

“They are killing offshore lira liquidity to stop foreigners shorting the lira,” said Timothy Ash, a strategist at BlueBay Asset Management in London.

Then again, this strategy - which just recently was attempted by China - tends to have a very short-term effect, as it does nothing to alleviate the underlying reasons behind a currency selloff.

For now however it is working, and the lira jumped for a second consecutive day, surging as much as 7% against the dollar with the USDTRY briefly sliding below 6.00, reversing much of the decline triggered by tensions with the U.S. Those tensions have been centered on a dispute over the detention of an American pastor, which resulted in tariffs and sanctions. The dispute exacerbated existing concerns about President Recep Tayyip Erdogan’s unorthodox approach to economic policy.

While on Monday the central bank promised “all necessary measures” to maintain financial stability, it didn’t mention higher interest rates and hasn’t raised them yet, even though Turkish corporate and banking executives have asked it to. Then on Tuesday,in another attempt to stabilize sentiment, we reported that the banking watchdog took an unconventional step to support the nation’s beleaguered banks, temporarily excluding the effect of day-to-day securities losses on how their financial strength is calculated.

The suspension of mark-to-market calculations on capital adequacy ratios will continue until prices of securities “normalize,” the banking regulator said in a document sent to banks on Tuesday. The "recent speculative volatility in markets" caused an “unfair erosion" in banks’ capital strength, it said. Under mark-to-market accounting, portfolios must reflect assets’ current market values rather than their book values.

The emergency moves followed the publication of a report from Goldman last week which spooked traders, and predicted that USDTRY above 7.1 would wipe out the banks' excess capital.

The average capital adequacy ratio of the banking system stands at 16 percent as of the end of June, according to official data. Every 10 percent decline in the lira reduces capital adequacy ratios by around 50 basis points on average, according to the Goldman Sachs report.

The BDDK also published a new set of regulations on loan restructurings by banks, financial leasing and factoring firms in the Official Gazette on Wednesday, Bloomberg reports. The new rules allow banks to extend the maturities of outstanding loans to clients, refinance them, make new loans to help troubled companies, and seek new collateral. Banks can also demand debtors sell assets to repay debts and improve their finances. Overdue loans can now be restructured within two years from the day a framework agreement is signed.

* * *

Meanwhile going back to the ongoing escalation in political tensions between the US and Turkey, one day after Erdogan vowed to boycott US electronics products, including the iPhone, Ankara slapped an additional tax on imports of a broad range of American goods. Turkey announced it would impose an additional 50% tax on U.S. rice, 140% on spirits and 120% on cars. There are also additional charges on U.S. cosmetics, tobacco and some food products. The was Erdogan's latest retaliation for the Trump administration’s punitive actions over the past few weeks to pressure Turkey into releasing an American pastor.

Bloomberg calculated that the items listed in the decree accounted for $1 billion of imports last year, similar to the amount of Turkish steel and aluminum exports that were subjected to higher tariffs by President Donald Trump last week. The decision shows Turkey giving a proportionate response to American “attacks” on the Turkish economy, Vice President Fuat Oktay said in tweets this morning.

Zor günlerde liderinin etrafında kenetlenen Milletimiz, kural tanımaz tavırlara karşı uluslararası kamuoyu ile de kenetlenmiş, haksızlıklara karşı Dünya’yı cesaretlendirmiştir. Durmak yok, yola devam.

— Fuat Oktay (@fuatoktay06) August 15, 2018

In addition to imposing the new tariffs, Erdogan assured the spat with Trump would get worse before it gets better after a local court denied US pastor Brunson's appeal to be released from house arrest. A local court in Izmir rejected the appeal by the US Pastor to be released from house arrest pending his trial on espionage and terrorism-related charges.

A higher Turkish court was still considering the appeal and Brunson's lawyer, Ismail Cem Halavurt, told CBS News on Wednesday that he would not consider the appeal formally rejected until the higher court issues it's ruling. He said that was likely to happen by the end of business on Wednesday. A previous appeal by Brunson was rejected at the end of July.

In response to this barrage of new developments out of Turkey, we expect Trump will shortly escalate his own crackdown on Turkey most likely in a tweet which in turn will send the lira plunging once more.

Author: Tyler Durden
Posted: August 15, 2018, 10:24 am

It wasn't just David Einhorn who picked just the wrong time to dump most of his Apple stock: in the second quarter, some of the most iconic hedge funds like Duquesne’s Stanley Druckenmiller, Moore Capital Coatue Management and Jana Partners either bought or added to stakes in Facebook in the second quarter... just days before the company's biggest crash in history.

Other weres luckier, and the rich(est) got richer, as Warren Buffett’s Berkshire Hathaway boosted its stake in Apple from 239.6 million shares to 252 million shares, and added to Teva and Goldman Sachs, while trimming holdings in Wells Fargo, American Airlines, and United Continental.

Also observed during Q2: hedge fund managers made big Q2 bets that the U.S. economy would continue to expand despite increasing concerns about a broadening trade war. Third Point added new positions in payment companies PayPal Holdings and Visa, both of which are up more than 19% year to date. Greenlight Capital, run by billionaire investor David Einhorn, added new positions in low-to-middle income retailers including Dollar Tree, Dollar General , Gap Inc and TJX Companies (or maybe he just hired a new and convincing retail analyst).

At the same time, Reuters notes that some other large hedge fund managers cut their positions in FAANG stocks - Third Point sold all of its stake in Alphabet and divested 1 million shares of Facebook, reducing its position in the company by 25 percent. At the same time, it increased its stake in Microsoft by nearly 310 percent, buying 1.7 million shares. Omega Advisors, meanwhile, sold all of its position in Netflix.

As noted earlier, a number of prominent HF managers sharply cut their stake in Apple only weeks before it became the first publicly traded U.S. company to be worth more than $1 trillion. Einhorn’s Greenlight Capital slashed its stake by 77%, while Philippe Laffont’s Coatue Management got rid of 95%. Advisory firm Diamond Hill Capital Management cut its stake by 27%. Other big holders, including Sanders Capital and Adage Capital Partners, trimmed only small amounts in the second quarter. On the other side of the trades were Warren Buffett and a variety of central banks and sovereign wealth funds.

Some other observations from the latest set of 13Fs:

  • Hedge funds hummed their way into holding Spotify stock in Q2, as the company was acquired by Tiger Global, Coatue Management, Maverick Capital, Moore Capital and Soros Fund Management
  • Davidson Kempner, Soroban either exited or sold down stakes in NXP Semiconductors in the quarter before the company’s deal with Qualcomm was terminated last month, while Third Point and Highfields Capital Management added a new stake.
  • Soros Fund Management cuts bank holdings including Bank of America, JPMorgan Chase and Citigroup
  • Jana Partners added shares of broad-based exchange-traded funds that track the S&P 500 and the Russell 2000 indexes and took new positions in Wells Fargo & Co and food delivery company GrubHub.
  • Greenlight Capital trimmed its stake in Apple along with Coatue Management before shares jumped 13 percent since the end of June.
  • Eminence Capital exited its position in Papa John’s before shares dove following news that John Schnatter, the firm’s founder and then-chairman, used a racial slur, leading him to resign.
  • Activist Corvex, fresh off Tuesday’s news that its target Energen is being purchased by Diamondback Energy, reported a new stake in MGM.

Courtesy of Bloomberg, below is a summary of the biggest buys and sells from the latest round of 13F filings as of June 30.


  • Top new buys: NVT, PEG, VST, MAS, D, F, OGE, FCX, TRU, BV
  • Top exits: NKTR, RTN, CQH, VVC, ETR, AGR, NDSN, PX, AEP, WCN
  • Boosted stakes in SHPG, AET, MRK, AMZN, LMT, WFC, SRPT, HON, MMM
  • Cut stakes in CC, DE, WRK, EMR, ITW, CI, PNC, BAC, DLTR, FTV


  • Top new buys: AVGO, MIK, CLBK, HSIC, TRNC
  • Top exits: PRF, AFSI, ALLE, SKYW, RCII
  • Boosted stakes in LBRDK, PAH, MATW, HILI, GHL
  • Cut stakes in GLIBA, ARCH, HDV, GLW, IWM


  • Top new buys: KEY, SYMC, CFG, VST, EDU, NXPI
  • Top exits: QQQ, AMAT, SMH, ALL, NVDA, HCA, BTU, URI
  • Boosted stakes in MU, WDC, LNG, WFC, PAH, PCG, KNX, KMT, SUM
  • Cut stakes in BABA, NRG, BAC, MGM, ALLY, AGN, XPO, GOOG, AMLP


  • Top new buys: T, BBY, WMT, ERJ, LNC
  • Top exits: BURL, AIG, VIPS, URI, HTZ
  • Boosted stakes in WFC, STI, DLTR, EVRG, DWDP
  • Cut stakes in DIS, AA, NTRS, V, DRI


  • Top new buys: TRCO, SBGI, TBIO, SHPG
  • Top exits: PBF, IMOS, FWP, OREXQ
  • Boosted stakes in FOXA, FOX, PCG, ABC, AGN, TMQ, VSAT, MCK
  • Cut stakes in LN


  • Top exits: VRSK
  • Boosted stakes in AAPL, USB, TEVA, BK, DAL, GM, GS, LUV, AXTA
  • Cut stakes in AAL, PSX, CHTR, UAL, WFC


  • Top new buys: GWR
  • Top exits: FTNT, JACK, RDC, MDRX
  • Boosted stakes in WCC, IWM, FCE/A, AXTA, SPY, OTEX, COMM
  • Cut stakes in XLNX, MD, ON, ISBC


  • Top new buys: CMI, AMAT, BABA, BMY, WMT, JNJ, LMT, AKAM, PHM, INTC
  • Top exits: PG, GE, DVA, RIG, PEP, CPB, AMGN, FCX, DRI, MAS
  • Boosted stakes in TD, RY, IEMG, TOL, CVX, MCD, SU, TEL, BNS, CAT
  • Cut stakes in VWO, EEM, SPY, NFX, FB, SWN, CLF, BBBY, ABC, BIIB


  • Top new buys: KDP, EQH, EVRG, BNS, BJ SBUX
  • Top exits: AMD, USG, BABA
  • Boosted stakes in C, AMAT, AMZN, V, KEY, DVN, MU
  • Cut stakes in AVGO, ADI, LRCX, UTX, CSCO, ABT


  • Top new buys: EL, CAT, LMT, MCK, VZ, CCE, FITB, LOPE, AGNC, ABX
  • Boosted stakes in PGR, HRB, COLM, WLK, DNB, ITW, CMD, ROK, MO, SNPS
  • Cut stakes in FB, D, GOOGL, ABBV, AVY, REG, WCG, AMGN, EA, HSY


  • Top new buys: SPOT, INTC, NOW, AAXN, HTZ, HUYA
  • Top exits: SNAP, RHT, WDC, CGNX, LRCX
  • Boosted stakes in FB, MSFT, ADBE, ATVI, PYPL, TAL
  • Cuts stakes in MU, AAPL, AVGO, BABA, FWONK


  • Top new buys: MGM, VNO, MDB, MHK, CHTR, LCA, FOXA, CTL
  • Top exits: BABA, EVHC, KDP, IQ
  • Boosted stakes in TMUS, NXPI, JBLU, BAC, MSFT
  • Cut stakes in EGN, CRM, GOOGL, MDCO, FG, NOW, ICE, FB


  • Top new buys: FB, GILD, OIH, MPC, SPLK, ADSK, DVN, ATVI, XLE, HD
  • Top exits: INTC, NKTR, MU, JD, QCOM, YNDX, VIPS, STL
  • Boosted stakes in MSFT, BABA, WDAY, CTRP, PAGS
  • Cut stakes in GOOGL, STMP, AMZN


  • Top new buys: DVN, VMW, FOX, SRE
  • Top exits: EGN, TER, NOMD, VICI
  • Boosted stakes in HES, DISH, EQT, MFGP, QQQ, ATHN, WIN, NXPI
  • Cut stakes in CDK, ISBC, WIT, IMPV


  • Top exits: PZZA, NEWR, JACK
  • Boosted stakes in ELLI, TTWO, VMC, LEN, CF, EFX, EA, GOOG
  • Cut stakes in WEN, ICE, MSFT, CBRE, ADSK, PYPL, IQV, FB, CYBR


  • Top new buys: UEIC, CASY, GRPN
  • Top exits: FNSR, MX, IWM
  • Boosted stakes in APOG, STKL, BHE, BW, NCR, PETX
  • Cut stakes in CCRN


  • Top new buys: C
  • Top exits: SRG
  • Boosted stakes in T, VSTO, OAK
  • Cut stakes in JOE, SHLD, VST


  • Top new buys: NVT, MSFT, FBHS, HOLX
  • Top exits: TMUS, CAH, RLGY, CMCSA, V, HUM, FB
  • Boosted stakes in ESRX, FDC, CHTR, AET, ENDP, AGN, ARMK, MTOR, MCK, CNDT
  • Cut stakes in HCA, LH, ANTM, CAR, IQV, UHS, NWL, CVS, WBA, APTV


  • New buy: GWR
  • Exits: KLXI
  • Boosted stakes in ARCC, HXL, ADS, WCC, ALB
  • Cut stakes in NGVT, TNET


  • Top new buys: GPS, DG, TJX, AZO, DLTR, BBY
  • Boosted stakes in IAC, BHF
  • Cut stakes in MU, AER, AAPL, MYL, VOYA, PRGO, CNDT, ADNT, CNX, DSW


  • Top new buys: NXPI, CVS, FB, LEN, PBR/A, SNE, ESRX, ACWI, MHK
  • Top exits: EXPE, HDS, DLTR, IVZ, ENB, HAL, X, PE, MDLZ, TGT
  • Boosted stakes in CHTR, AET, GOOGL, DIS, GOOG, EQT, RJF, MIK
  • Cut stakes in HCA, FOXA, FDX, CMCSA, PXD, HLT, VER, H, VOD, CCE


  • Top new buys: EGN, VMW, AFSI, CI
  • Boosted stakes in IEP, NWL
  • Cut stakes in HLF, LNG


  • Top new buys: FB, BABA, MSFT, WFC, DXC, GOOGL, RPM, GRUB, ATUS
  • Boosted stakes in PF, SPY, EA, CAG, A, AAPL
  • Cut stakes in TIF, LRCX, HDS, ADSK, BSX, GM, ZBH, FDC, JACK, ANTM


  • Top new buys: ESRX, ASND, FB
  • Top exits: CJ, ABG,
  • Boosted stakes in C, BIDY, WRK, CMCSA
  • Cut stakes in CIT, ADNT, RLGY


  • New buy: DHI
  • Top exits: RLJ, MAR, RESI, VTI, HST
  • Boosted stakes in CLI, BKD, LEN, INVH, PLD
  • Cut stakes in LSI, MAC, QTS


  • Top new buys: CP, NVDA, MHK
  • Top exits: AVGO, TSM, BLK, TMUS, EXAS
  • Boosted stakes in WYNN, TDG, MSFT, BABA, NOW, MELI, GOOG, IQV, BKNG, PAGS
  • Cut stakes in FB, PYPL, STZ, ADBE, AMZN, FLT, EA, TRU, CSX, UNH


  • Top new buys: IMAX, CPLG
  • Boosted stakes in TEX, THRM
  • Cut stakes in IAC, ITRI, DXC, BLDR, AIR, TPHS, VRTS


  • Boosted stakes in DLTR, MA, CNC, TMUS, MHK, CIEN, BUD, MSFT, KORS, SCHW
  • Cut stakes in V, UHS, EVHC, DWDP, AMRX, ADBE, WTW, VFC, TIF, TPR


  • Top new buys: TMUS, AXGN, TSM, BRX, IDXX, GPS, CMG, ACGL, JEC, MTN
  • Top exits: SCI, NTRS, CME, NKE, MU, SRCL, JPM, IBN, FLT, AXP
  • Boosted stakes in TFX, ATVI, BBY, DGX, SPGI, MCD, BURL, ROST, ZTS, VRTX
  • Cut stakes in BABA, BAC, DISCK, AVGO, UNH, SAGE, GS, AJG, GILD


  • Top new buys: NXPI, GOOGL, WFC, MA, SPOT, TGT, FDC, AMP, KMX
  • Top exits: MS, AAPL, GS, LMT, NOC, RTN, GD, COF, BPOP, PLNT
  • Boosted stakes in GCP, FB, EQT, PX, FBP, MOMO, NVDA, CME, GM, TMUS
  • Cut stakes in BABA, BAC, MSFT, AVGO, CCI, ISBC, V, TWTR, EA, VOYA


  • Top new buys: NRG, IQV, LEN, MPC, CVS, KKR, MGY, WRD, CDAY, IMMU
  • Boosted stakes in SBGI, ASH, HUM, TRN, C, FTSI, MU, TMO, PE, FRAC


  • Top new buys: MITL, AKRX, CMCSA, ATUS, FOXA, LHO
  • Top exits: MDR
  • Boosted stakes in DISCK, NXPI, FOX, AET, XL, TMUS
  • Cut stakes in GOLD, IAG, COL, AEM, GG, SHPG


  • Top new buys: LOW
  • Boosted stakes in UTX, MDLZ
  • Cut stakes in ADP, QSR


  • Boosted stakes in GOOGL, HLT, BMY, PE, BIDU, SYK, DVN, CMCSA, DXC


  • Top new buys: MPC, FB, CVX, TEVA, PXD, NXPI, STM, USFD, NOW, APC
  • Top exits: BAC, CFG, AVGO, DE, RF, FCAU, MYL, GS, NOC, GILD
  • Boosted stakes in TRGP, AET, FE, NFLX, SHPG, MSFT, BABA, ADBE, VRTX, JD
  • Cut stakes in CRM, LRCX, LNG, LOW, DWDP, LOMA, BMA, LLL, LYB, X


  • Top new buys: AAPL, FB, MSFT, MS, AXP, ITW, CME, WY, FL, AMG
  • Top exits: BKNG, VZ, MON, PG, WFC, SLB, TWX, KO, CVS, BDX
  • Boosted stakes in VMW, ABMD, JNJ, WMT, VRTX, HLF, ABEV, WWE, GS, CTXS
  • Cut stakes in HD, AMZN, BMY, LLY, PEP, UNH, NXPI, PM, CL, GILD


  • Top new buys: KLXI, PAY, ANDV, GPT, EVHC, ILG, EDR, PF, COTV
  • Top exits: STB, BABA, AKRX, BKS
  • Boosted stakes in COL, NXPI, AVA, ORBK, XL, FB, AMZN, AAPL, MSFT, GOOG
  • Cut stakes in OCLR, MGI, KS


  • Top new buys: MRK, FOXA, HD, BKI, LNG
  • Top exits: AVGO, ARNC, LOW, BUD, CMCSA
  • Boosted stakes in CZR, ICE, APTV, FDC, BA
  • Cut stakes in DWDP, DHI, JAZZ, FG, XPO


  • Top new buys: GOOGL, UTX, GRA, MHK
  • Top exits: BUD, CMCSA, LBRDK, FB, CHTR
  • Boosted stakes in SAP, NSC, AXTA
  • Cuts stake in NXPI, UNP, MGM, AVGO, FWONK, GOOG


  • Top new buys: SPOT, P, COUP, FB, DVN, EXR, HUBS, HLT
  • Top exits: KW, LRCX, AMLP, ZAYO, BAX, TMO, LH, TGT, CI, KRE
  • Boosted stakes in NXPI, XL, I, LPLA, NOW, CRM, TTWO, LULU, CVE, ETFC


  • Top new buys: WEB, RPM, SCOR
  • Top exits: EVHC, BCO
  • Boosted stakes in BMS, IWN, PRGO
  • Cut stakes in NWL, MAC, CARS, BAX, DEPO


  • Top new buys: ASLN
  • Top exits: KRE, JPM, BAC, WFC, MS, GS, SENS, RDUS
  • Boosted stakes in CTL, HDB, PYPL, V, GPN, MA, PTLA, DWDP, WP, AVGO
  • Cut stakes in VIRT, AMRS, NETS, AMZN, BABA


  • Top exits: EHIC, SINA, ARCC, UAL
  • Boosted stakes in TWTR, FB, NOW, MELI, RUN, BABA, SE, APO, CRM, ADSK
  • Cut stakes in RDFN, JD, TDG, MSFT


  • Top new buys: NXPI, PYPL, V, CPB, DE, FPAC, EGN, PVH, CWH
  • Boosted stakes in MSFT, ADBE, EA, MPC, UTX, DWDP, CRM, SHY, DOV
  • Cut stakes in BLK, WP, STZ, FB, LEN, WYNN, SPGI, SHW, VMC


  • Top new buys: NVT
  • Boosted stakes in BK, GE, MDLZ
  • Cut stakes in PNR, WEN, SYY
  • Activist investor Trian takes new stake in undisclosed company


  • Top new buys: AVHI, HD, CHFN, SHPG, VZ, FFKT, LHO, FBNK, NKE, ANDV
  • Boosted stakes in PF, FOXA, TGT, TJX, BIDU, COL, AAPL, AET, JPM, CMCSA
  • Cut stakes in SPY, NXPI, AMZN, C, WBA, MU, PAGS, BKNG, PDCO


  • Top new buys: UFI, LIND, STRA, AES, EVA
  • Boosted stakes in C, SLM, ADS, BHC, STX, AFI, MS
  • Cut stakes in FOX


  • Top new buys: GE, DWDP, MIDD, TMUS, ILMN, HBI, OLN, PTEN, CNC
  • Boosted stakes in UTX, DIS, TMO, PE, AMZN, HIG, BMRN, MSFT, LNC, ANTM
  • Cut stakes in XRAY, GOOGL, TD, FB, CP, NFLX, EFX, V, BUD, ADSK


  • Top new buys: NVT, CNC, USG, PRSP, T, ATUS
  • Top exits: GRA, SHPG, EVHC, WHR
  • Boosted stakes in NXPI, XL, FMC, ESRX
  • Cut stakes in TRCO, AABA, AVGO

Source: Bloomberg

Author: Tyler Durden
Posted: August 15, 2018, 9:33 am

After  last night's violent, coordinated rampage by masked gangs of youths across five Swedish cities, Swedish politicians were quick to react with far-right, anti-immigrant party 'Sweden Democrats' seeing a surge in the polls ahead of September 9th's election.

"I get pissed off for real," Prime Minister Stefan Löfven hit out in an interview with Swedish radio, adding he wanted to ask the perpetrators "what the hell are you doing?"

"Society will come back hard on this," said the Social Democrat leader, who also raised questions about the scope and timing of the attacks, which police suspect were coordinated via social media.

"It looks very coordinated, almost like a military operation," Löfven said, adding that the police probe would show if the car fires were down to vandalism, organized crime or something else.

And one look at the times of the events confirms it...

As The Local reports, Lofven was not alone in his outrage.

Justice and Interior Minister Morgan Johansson called the attacks "despicable".

"Last year the government tightened the punishment for aggravated vandalism, which can now give up to six years in jail," he tweeted.

"Hope the thugs get arrested so that they get the punishment they deserved."

Ulf Kristersson, leader of the centre-right opposition party the Moderates, wrote on Facebook that "dreadful scenes are being played out in Gothenburg".

"These are no 'protests', this is sabotage. Sweden has tolerated this far too long. It has to end," he added.

Roger Haddad, justice spokesperson for the Liberals, called the attacks "unacceptable".

"Parents also have to be involved, they have to be woken up and informed of what their sons are doing," he wrote in a comment.

As Sweden's SVT reports, the police have identified several of the young people who were in place at the fires in Trollhättan and confirmed that there is suspicion that the action has been coordinated.

"We have already started talking to parents with the parents in the morning, who were in place. We chose not to seize someone but have identified them and talked with them, "said Ulla Brehm.

We have an update on the situation.

The Swedish police spokeswoman Ulla Brehm says that they have DECIDED to NOT arrest anyone over the riots last night.

Instead they have identified them and will be talking with their families.

This has caused an outcry amongst Conservatives.

— PeterSweden (@PeterSweden7) August 14, 2018

Based on testimonies and the fact that the fires started about at the same time, the police suspect that the actions may have been coordinated through social media.

Author: Tyler Durden
Posted: August 15, 2018, 9:05 am

Authored by Viktor Katona via,

It took more than 20 years for littoral states of the Caspian Sea to reach an agreement that would lay the legal foundations for the full utilization of the region’s resources. The Fifth Caspian Summit in Aktau, Kazakhstan, brought the long-sought breakthrough after leaders of Russia, Kazakhstan, Azerbaijan and Iran signed the Convention on the Legal Status of the Caspian Sea – a remarkable feat considering that heretofore, barring bilateral deals, the Caspian has been governed by an obsolete 1940 convention between the Soviet Union (of which four current littoral states were a part) and Iran.

As the current Convention incorporates a plethora of tradeoffs between countries, let’s look at them in greater detail so as to grasp the implications of the deal.

The Convention stipulates that relations between littoral states shall be based on principles of national sovereignty, territorial integrity, equality among members, non-use of threat of force (it was only 17 years ago that Azerbaijan and Iran almost started a full-blown naval war over contested fields) and non-intervention.

The military-related clauses of the document can be considered a net diplomatic success for the Russian Federation as it prohibits the physical presence of any third-party armed forces, along with banning the provision of a member state’s territory to acts of aggression against any other littoral state. Since Russia is by far the most power nation in terms of both general military clout and military presence around the Caspian, this will placate Russian fears about any potential US (or other) encroachment in the area.

Then there’s energy... Although the Convention establishes a general legal framework for territorial disputes to be solved, it refrains from any particularities. Therefore prolonged negotiations are to be expected with regard to many disputed oilfields, stemming predominantly from Irani and Azerbaijani claims. Iran advocated throughout the entire negotiation process an egalitarian approach to delimiting the seabed (each nation would get 20% of the coast), running counter the other countries’ aspirations. The things is that when Russia concluded its seabed delimitation agreements with Kazakhstan and Azerbaijan in 2001 and 2003, respectively, the parties split their parts using the median line. Point 8.1. effectively keeps the delimitation task in the hands of relevant governments, thereby providing a very modest boost to the demarcation of the Southern Caspian (the Northern part is fully delimited).

There are two main territorial conflicts to be settled – the Irani-Azerbaijani and the Azerbaijani-Turkmen disputes. The row between Baku and Teheran revolves around the Araz-Alov-Sharg field (discovered in 1985-1987 by Soviet geologists), the reserves of which are estimated at 300 million tons of oil and 395 BCm of natural gas. Even though the field is only 90 kilometers away from Baku and should seemingly be under Azerbaijan’s grip, if one is to draw a straight line from the Azerbaijani-Irani border most of the field ought to be allotted to Iran (the median would keep most of it in Azerbaijan). As those old enough to remember the 2001 naval ship hostilities would attest, it does matter at what angle the final line is drawn.

The Serdar/Kapaz field (estimated to contain 50 million tons of oil) is the bone of contention between Azerbaijan and Turkmenistan. Considered to be an extension of Azerbaijan’s main oil-producing unit, the Azeri-Chirag-Guneshli field, Baku sees it as an indispensable element in its quest to mitigate decreasing oil output numbers. Geographically, Serdar/Kapaz is closer to Turkmenistan, yet here too Azerbaijan might come out the ultimate winner. The Apsheron peninsula stretches out some 60km into the Caspian Sea, in effect extending Azerbaijan’s geographical reach. Absent previous demarcation agreements between Baku and Ashgabat, the settlement will once again boil down to getting the angles right, as in the case of Araz-Alov-Sharg. However, it must be said that a resolution might come about as a by-product of new gas endeavors.

Clause 14, dealing with laying subsea pipelines and cables, is the one most coveted by energy analysts, since it has the potential to significantly alter Europe’s gas supply options.

According to point 14.2., all parties have the right to construct subsea pipelines given that they comply with environmental standards (which are particularly strict in the Caspian Sea). With no further caveat included, some analysts might be tempted to think that Russia will inevitably use the “environmental protection” card when trying to stop the construction of the Trans-Caspian pipeline (TCP) from Turkmenistan, a pipeline it spent many years to halt. Under current circumstances, when US-Russian relations falling ever deeper into an insurmountable ditch, Moscow’s decision to allow for the construction of the mightily Washington-backed TCP to take place might be perceived as a massive omission.

Since the Turkmen gas is unlikely to find demand in Azerbaijan or Turkey, it would need to take the whole route via the South Caucasus Pipeline, TANAP and TAP. Merely the transportation tariffs from these pipelines would render any transportation economically unviable unless European gas prices rise substantially to levels above $300/MCm. Moreover, the estimated cost of building the subsea TCP of $2 billion is a disabling burden for either Türkmengaz or SOCAR. Thus, allowing the construction of Trans Caspian gas pipelines might be a brilliant ruse from the Russians – cognizant of all the deficiencies above, they can wield it as a sign of good will in their never-ending negotiations with the European the economics for supplying gas to Europe via the Southern Gas Corridor are far from being Union.

This being said, there are natural impediments to see the TCP implemented anytime soon. Azerbaijan might be interested in getting transit fees for Turkmen natural gas, yet it lacks the required infrastructure to include the above volumes in its traditional conduit via Turkey.

All in all, the Caspian convention is a good basis for further negotiations, even though it falls short of being an all-encompassing legal framework. Territorial disputes will most likely remain frozen for quite some time and no new gas pipeline projects will see the light of day unless market conditions change.

Author: Tyler Durden
Posted: August 15, 2018, 9:00 am

The United Kingdom is to leave the European Union on March 29, 2019, but a final deal has yet to be agreed between Westminster and Brussels.

In the event of a "no-deal Brexit", the UK leaving the EU single market and customs union without a free trade deal, Britain would have to adopt rules set by the World Trade Organization (WTO). This scenario, as Statista's Raynor de Best notes, could mean that airline licenses, medicine certifications and certain citizen rights end overnight along with an increase in bureaucratic checks on goods and people passing in and out of the country.

According to estimates from the International Monetary Fund (IMF), a hard Brexit would also lead to significant long-term economic damage across the European continent.

Infographic: Brexit: Deal Or No Deal For The EU? | Statista

You will find more infographics at Statista

The Washington-based fund said the economic output of the EU-27 could be reduced by 1.5 percent of GDP by 2030.

Ireland, the Netherlands, Denmark and Belgium, all countries with close trading links to the UK, would be hit hardest. Germany would lose 0.5 percent of its GDP due to industrial supply chains.

Nations with financial ties to the City of London, such as Malta, Cyprus and Luxembourg, would also be negatively affected by a "no deal".

The IMF estimated, for example, that two-way bank claims between Luxembourg's financial sector and the UK were about 220 percent of Luxembourg's GDP.

Author: Tyler Durden
Posted: August 15, 2018, 8:15 am

Authored by Judith Bergman via The Gatestone Institute,

In July, the Union for the Mediterranean (UfM) celebrated its 10-year anniversary. Most Europeans, however, are unlikely to have heard about the Union, let alone the anniversary. The media rarely reports on the UfM and its activities.

The participating countries in the UfM are the 28 European Union (EU) member states and the Southern Mediterranean countries, which include Albania, Algeria, Bosnia and Herzegovina, Egypt, Israel, Jordan, Lebanon, Mauritania, Monaco, Montenegro, Morocco, "Palestine", Syria (temporarily suspended), Tunisia and Turkey. Libya has observer status in the UfM. The UfM is chaired by a "co-presidency" shared between the European Union and Jordan. The UfM Secretariatmaintains the daily operations of the UfM and is run by a Secretary General, presently Nasser Kamel (Egypt).

The UfM was launched by a decision of the UfM Heads of State and Government in Paris in July 2008, and constitutes an institutionalization of the Barcelona Process, which began in November 1995 with the signing of the Barcelona Declaration.

According to the European Institute of the Mediterranean (IEMed), the Euro-Mediterranean alliance launched by the Barcelona Declaration Process "was structured around three main work areas (political and security dialogue; economic and financial partnership; and social, cultural and human partnership)" between the EU and the mainly Muslim majority countries in North Africa and the Middle East (usually referred to in UfM context as the Southern Mediterranean).

In January 2017, the 43 foreign ministers of the UfM agreed on a "Roadmap for Action" in Barcelona, which aims at "enhanced regional cooperation and integration in the Mediterranean," setting out "three key interrelated priorities, regional stability, human development and integration." It was the first political document adopted by the UfM foreign ministers since 2008.

The UfM lists a number of ways in which it seeks to achieve regional stability and human development. One of them is "Intercultural and Interfaith dialogue" the aim of which is, among other things:

"[T]o exert all efforts to bridge any potential cultural divide to fight against extremism and all forms of racism and to build upon a common heritage and aspirations. Intercultural and Interfaith dialogue in the Mediterranean is an important underlying dimension of all regional cooperation activities in the framework of the UfM."

The EU countries involved in the UfM appear unbothered by promoting "integration" -- or even claiming "a common heritage" -- with countries such as Mauritania, where, according to recent reports, up to 20% of the population (Haratines and other Afro-Mauritanian groups) is enslaved, and anti-slavery activists are regularly tortured and detained.

The UfM has held 15 ministerial conferences on "key strategic areas" in the past 5 years on topics such as, Strengthening the role of Women in Society (Egypt, November 2017), Sustainable Urban Development (Egypt, May 2017), Water (Malta, April 2017), Energy (Italy, December 2016) Employment and Labour (Jordan, September 2016), Regional Cooperation and Planning (Jordan, June 2016), Blue Economy (Belgium, November 2015) Digital Economy (Belgium, September 2014), Environment and Climate Change (Greece, May 2014), Industrial Cooperation, (Belgium, February 2014) Energy (Belgium, December 2013), and Transport (Belgium, November 2013), as well as two Foreign Minister Conferences (Spain January 2017 and Spain November 2015).

The UfM aims to reach its priorities through projects such as "Empowering women and youth in the Mediterranean", "Promoting job creation and inclusive growth" and "Enhancing the Role of Women and Youth in Preventing Violent Extremism."

There is not the slightest allusion in the yearly report, nor in the 2017 Roadmap for Action, to the fact that in most Muslim countries, sharia law influences the legal code -- especially regarding personal status law, which concerns marriage, divorce, inheritance and child custody -- and that gender inequality may therefore be institutionalized and not something likely to change, regardless of the number of UfM projects. Nor is there any allusion to the role of Islamism in fostering "violent extremism". Instead, the roadmap for action speaks of joining "regional and international efforts to address socio-economic root causes of terrorism and extremism" and "developing further projects and initiatives of high impact, with a special focus on youth employability and women empowerment."

According to the European Institute of the Mediterranean (IEMed):

"From 1995 to 2006, the EU allocated 16,000 million euros through MEDA programmes for bilateral and regional cooperation, aimed at fostering both socioeconomic projects (modernisation of the industry, promotion of the private sector, reform of the health sector, development funds...) and political and good governance reforms...

"The cooperation funds are channelled through the European Neighbourhood and Partnership Instrument (ENPI), aimed at both the eastern European and southern Mediterranean neighbourhood. The joint budget for both regions for the period 2007-2013 amounts to 11,000 million euros...

The funds allocated to cooperation with the EU neighbouring countries(in eastern Europe and the southern Mediterranean) for the period 2014-2020 amount to 15,000 million euros."

These figures do not include bilateral agreements between the UfM and EU countries, such as the €6.5 million multi-annual financing agreement between the UfM Secretariat and Sweden "to deepen and amplify UfM specific cooperation initiatives and core activities promoting regional dialogue."

Given these large sums, it is remarkable that the UfM and its activities enjoy little to no scrutiny in the European press. Especially as, in the words of IEMed in its 2015 assessment of the 20th anniversary of the Barcelona Process, "The scenario of concord set out for the Mediterranean in the 1995 Barcelona Declaration has never become a reality".

Subsequent Islamic radicalization and terrorism and the years-long migrant crisis constitute recent examples of the failure. IEMed's assessment continues:

"The roadmap designed in the Catalan capital could not predict the destabilising effects on the region of al-Qaeda on 11S and the subsequent invasions of Afghanistan and Iraq; the political immobility and lack of reforms and improvements in governance in many MPCs; the non-creation of the free trade area in the Mediterranean scheduled for 2010; the lack of south-south regional integration; the instability caused by the Arab Spring since 2011, currently with two failed states, Syria and Libya; the migration and refugee crises; or the emergence of Islamic State terrorism that is ravaging Syria and Iran and has already shown its capacity to attack Europe."

The UfM has itself conceded:

"UfM countries have among the highest unemployment rates in the world, affecting mostly youth and women, which adds to many other pressing issues such as social cohesion, migration or efforts to counter radicalization."

Despite this apparent evidence of the failure of the Barcelona Process and the UfM, the latter nevertheless sees itself as having "entered a new phase, building on the progress achieved so far... increasing and expanding activities demonstrate that windows of opportunity exist to further develop regional cooperation."

The UfM, undeterred, barrels on with its goal to achieve:

"greater levels of integration and cooperation in the region through a specific methodology that has yielded positive results in terms of political dialogue and the implementation of region-wide initiatives in which young people play a key role.

With more than 50 labelled projects and over 300 ministerial and expert fora gathering 25,000 stakeholders since 2012, UfM activities illustrate the strong belief that regional challenges call for regional solutions and that there is no security without development."

It seems counterintuitive that nearly a quarter century of costly investment by Europe in the southern UfM countries appears to have yielded few to no positive results.

A map of the Union for the Mediterranean members. Blue are EU member states, brown are other members, Libya (red) is an official observer, and Syria (green) is a suspended member. (Image source: Treehill/Wikimedia Commons)

Despite the UfM's own aforementioned assessment of challenges having reached "unprecedented levels," the EU nevertheless continues the Barcelona Process in the form of the UfM. It is also bizarre that any substantive evaluation of the costs and benefits of the Barcelona Process, and the UfM and its many projects is absent from most public discourse, as the media apparently fail to report on the UfM and its activities.

Author: Tyler Durden
Posted: August 15, 2018, 7:30 am

If you want to move to the world's most liveable city, pack your bags and book a flight to Vienna.

The Economist assessed 140 major cities worldwide on stability, healthcare, culture and environment, education, and infrastructure, declaring the Austrian capital the most liveable city for the first time. Australia's second most populous city, Melbourne, scored 98.4 out of 100. Osaka, Japan, came third with Calgary and Sydney rounding off the top five.

Infographic: The World's Most Liveable Cities  | Statista

You will find more infographics at Statista

In total, three Canadian and three Australian cities made the top-10 list.

Interestingly, U.S. cities are notably absent from the top of The Economist's ranking with Copenhagen the only other European city this year besides Vienna.

However, as Statista's Niall McCarthy notes, even though people living in Damascus are daring to hope that their country's long and bloody civil war might be drawing to a close, the Syrian capital is at the opposite end of the ranking. It scored just 30.7 out of 100 where 100 is ideal.

Infographic: The World's Least Liveable Cities | Statista

You will find more infographics at Statista

Dhaka, Bangladesh and Lagos, Nigeria, rounded off the bottom three with scores of 38.0 and 38.5 respectively.

While most of the bottom-10 are scattered across Africa and the Middle East, Karachi in Pakistan and Port Moresby in Papua New Guinea were among the bottom-ranked cities.

Author: Tyler Durden
Posted: August 15, 2018, 6:45 am

NFA News Releases

July 30, Chicago—NFA has ordered Chicago, Ill. futures commission merchant R.J. O'Brien and Associates LLC (RJO) to pay a $150,000 fine.
Posted: July 31, 2018, 4:59 am

Elite Forex Blog - Market Research & Analysis

Online retailer Overstock reported results which, unlike its much more famous and infinitely bigger online retailing peer Amazon, were nothing special: the company reported Q2 revenues of $483 million, generating a net loss for the quarter of $2.20 on a gross margin of 19% in the quarter.
But the company's earnings were not the reason why OSTK shares soared as much as 25% after hours: the reason was the surprising announcement by the company that Hong Kong-based private-equity firm GSR Capital had agreed to invest as much as $375 MM in exchange for equity in the retailer and, more importantly, its tZero blockchain subsidiary, which as a reminder capitalized on the cryptocurrency craze in late 2017 and concluded an Initial Coin Offering on December 18, 2017, almost to the day when Bitcoin hit an all time high of just under $20,000.
As Overstock announced in its press release, GSR agreed to:
  • i) buy $30MM in tZero tokens,
  • ii) buy up to 3.1MM shares of OSTK for $104 million (a 5% discount to the Aug. 1 closing price of $33.72),
  • iii) invest as much as $270MM for up to 18% of tZero’s equity at a whopping post-money valuation of $1.5 Billion.
And since Overstock's market cap as of Thursday's close was just over $1.1 billion, this means that with one term sheet, the company's tZero sub is suddenly worth more than the entire parent company. More importantly, the GSR transaction will boost the company's cash and equivalent holdings to over half a billion dollars.
Some more details from Byrne:
Having concluded its Security Token offering, tZERO has raised aggregate consideration of $134 million. This figured includes $30 million from repayment of intercompany debt between tZERO and Overstock. GSR has signed a repurchase agreement to acquire these tokens. As I will diagram in our earnings call, we have designed quite an ecosystem with a scale that matches the enormous opportunity in front of it. When GSR completes its planned investments, we should have over half-a-billion dollars. We believe this will provide ample capitalization with which to build a company that can upend global capital markets.
Back in December, when Overstock launched its tZero ICO, it said that it was hoping to raise at least $250 million - and as much as $500 million - "to build out a blockchain system that the firm said would allow it to create an exchange to trade blockchain-based assets, like ICOs." In the end it raised aggregated funds of just approximately $134 million, and today's transactions adds to that and enables CEO Patrick Byrne to pursue his Security Token ambitions.
As a result of the deal, OSTK stock has jumped and was trading as high as $46/share after hours.
Even with the surge however, the stock remains well below its highs hit in late 2017 and early 2018, when its share price more than doubled to a high of $86.90 in January, due to its blockchain investments rather than its online retailing activities, which have seen it categorised as a cryptocurrency "play."
Overstock has been one of the few retailers that has aggressively pursued cryptos as both a method of payment and as a means by which to grew the company with its own unique token. As we reported recently, following a burst of adoption of cryptos by various vendors, as the price of bitcoin has tumbled in 2018, so has the rate of adoption. Which is why Overstock's experiment with cryptos and tokens will be closely watched to determine if the digital currency has any chance of becoming useful in practice instead of just in theory.

Posted: August 9, 2018, 10:31 pm

Past performance is not necessarily indicative of future performance.

Past performance is not necessarily indicative of future performance.

The risk of loss in trading commodity interests can be substantial. You should carefully consider whether such trading is suitable for you in light of your financial condition. This material does explain all the risks involved in futures and options trading. Please refer to the following for a fuller disclosure and our risk disclosure statement:

About this podcast: EP 137: The horse bettor exploiting anomalies in financial markets – Dr. William Ziemba Dr. William Ziemba’s an academic, a practitioner, gambler, trader and an author. He’s worked with and consulted to many well-respected names in the field, such as; Edward Thorp, Blair Hull and the very successful horse bettor, Bill Benter. In the beginning, horse betting was William’s field of expertise (he even published a book titled, Beat The Racetrack!) And in many ways, for William, horse betting worked as a gateway to trading financial markets—which he’s been doing since 1983.

Visit for more info.
  alphaz options strategy
Posted: August 8, 2018, 6:51 pm
Crypto Day Trading - Electronic Day Trading became popular in the mid 1990's with the rise of 'retail' stock trading, meaning that anyone with $50,000 could open an account and trade with "Level 2" access which was purportedly the same access the market makers had.  Of course day-traders were no match for professional market makers but suddenly the .com bubble happened and stocks like (AMZN) and many others.  After the .com bubble burst, day traders looked for other electronic markets to trade, some gravitated to Futures & Forex.  Forex day traders thrived for a long time, until the Dodd-Frank regulations ended the hope of having a profit from a Forex strategy in the USA (and in the same action, effectively blocked access to decent honest brokers for US Citizens.  This void was filled with the Binary Options scam that continues to this day (people still believe that someone, somewhere is making money with Binary Options, contrary to forensic evidence).
Enter Crypto Currency which was relatively undeveloped as a traders' market until the huge rise of BTC/USD in the fall of 2017.  Now there is a quickly growing community of Crypto Day Traders and Total Cryptos is here to facilitate that.  The problem with trading Crypto vs. other markets is there is a huge amount of fake data in Crypto.  As any trader knows, information is king - which is why it's important to have real-time information that matters.  Just like in FX, that may mean looking at multiple exchange prices.  It means having multiple sources of news and data.  It means paying for information.  How bad is the problem of bad data?  Just look at today's news, from Coin Desk, where 'A CoinMarketCap "data issue" caused significant artificial inflation of several coins listed on the platform on Friday, with some prices inflated by nearly 1000 percent.':
While bitcoin's price spiked 12 percent on the crypto data site, other coins saw more drastic increases. The price of aeternity, the eighth most valuable cryptocurrency, increased more than 951 percent, while MOAC increased by 905 percent and bitcoin diamond saw an 876 percent jump on the site. The site's exchange tracker feature was also affected, and falsely indicated that bitcoin was trading above $73,000 on some exchanges.  While crypto Twitter speculated about potential price manipulation, bugs and hacking, CoinMarketCap told CoinDesk that the inflation was caused by a data error.  "There was a price calculation error on tether which caused any listing with a tether market to become artificially inflated," marketing vice president Carylyne Chan said in an email.  While most of the data appeared to have normalized at press time, the 24 hour change percentage for VeChain's VET token was listed as a question mark and its price graph was unavailable on the home page. The VeChain page also had no historical data listed.  The popular analytics platform has promised to release a "post-mortem" with further details in the near future.
Imagine that happened in the stock market.  So the good news, any new market presents new and uncharted opportunities.  With that as always comes big risks, but it is a traders job to manage and maintain control of those risks.  Having the right tools is par for the course.  Or take a look at this article "Why intra-day trading crypto can be better than holding":
If you are relatively new to trading crypto currencies, then this tutorial is what you need. In this tutorial I will try to explain how you can use crypto to grow your capital base by at least 1% per day.The reason why holding isn’t a very practical move for well established coins is because of their volatility. For instance, Bitcoin (see chart below), increased by ±30% over a period of ±20 days. But it doesn’t mean it had a linear increase of 1.5% per day, some days went down while others went up.
Of course, it's easy to go back and say if we had just bought at the low and sold at the high every day for the past 30 days we would have made a fortune, the reality is that trading is not so easy.  However, there are tools out there so advanced and sophisticated that it helps the Crypto Day Trader.
Total Cryptos is extensively researching this new market as well as working on our development of real time trading systems for Crypto Day Traders.  We've opened a public forum on the topic for open discussion which can be found here: Registration is free so join the discussion today!

Posted: August 5, 2018, 10:50 pm
  • Private Equity investors or Pre-IPO investors may want to look at this hot new Crypto option.
  • Cornucopia is an example of how Blockchain is really innovating the alternative investment space.
The pace of new Crypto Currency offerings has increased dramatically in recent years. First, there were ICOs, then there were STOs, and now there is a mix of many kinds of new token offerings. Sites are popping up that track the prices of new Crypto Currencies just like for stocks. The nuances of regulation, as in anything new, have been the focus of the debate. What makes a securities token vs. a utility token, or if proof-of-stake is better than proof-of-work. We’re going to skip that in this article to focus on essence not form, to get to the heart of what this token is and why it represents a real new type of token based on an existing model. We are going to contrast this model, not the token, with others of a similar nature. Many who have been enchanted by the allure of Bitcoin have lost touch with what Blockchain really is – a technology. The blockchain is very innovative for banking but compared with what Silicon Valley has been inventing recently it really isn’t such a great achievement. The reason Blockchain is such a ‘revolution’ is mostly because of the lack of technological innovation in the financial services industry in general. For example in the United States, the “Fedwire” system used to send ‘wire’ payments in between financial institutions, was designed and implemented before World War 2, actually before 1940. The reason it is called a ‘wire’ payment is because this was a world where not everyone had a telephone, but every business had a telegraph, which was connected by copper wire. It is important to understand this history, in order to see that Blockchain itself isn’t something so innovative like lasers or fiber optics, or the microprocessor. But in a world where payments are made by ‘wire’ – Blockchain is a new paradigm which really changes the entire global financial system.
One more important elaboration before we dig into this token offering is the mature pre-IPO sector of ‘unicorns.’ During the .com boom IPOs were the hottest rage – get a business plan, buy a .com name, and go public. Very similar to what has happened with many ICOs, many of them fail to vet their underlying business model (in many cases they do not care to, they just want to raise funds as a means to another end). After the .com bubble burst, new IPO issues were on the decline, and since the 2008 credit crisis, they declined even more (for a number of factors which is the subject for another article). Companies that are worth more than $1 Billion in private markets but are still not public are called “Unicorns” because they are rare, but Unicorns are not so rare like they were 5 years ago. Now many companies continue to operate as private companies without going IPO, some notable examples include Uber, AirBnB, SpaceX, Palantir, Lyft, and others. The pre-IPO space is opaque, as companies are not publicly listed, they are not subject to the same reporting requirements as public companies. For example, financial statements which they do of course produce, are based on what the company says only (no third-party oversight). Financial reports produced by public companies are the opposite – they are subject to audits, third party checks, and if a mistake is made – there can be a liability for the financial officer who is responsible for the reports and/or for the company itself. In private equity, none of this applies. So, it’s a unique type of investing.
The obvious upside is that if and when a Unicorn does go public, there can be an event which will produce a 10x or 20x return. So as you can imagine, there are a number of companies that offer sale of pre-IPO stock in mature companies that have revenue. The rules are different, all investors must be accredited generally, and there can be restrictions on the stock (for example you can’t sell your shares until the IPO event). Some companies, like PTN – offer accredited investors more liquidity that it is possible to buy and sell pre-IPO shares in what could be called a dark pool.
Enter the world of Cornucopia, a token offering that provides retail investors access to these companies based on a ratings system. Horn tokens act like a private equity index fund but require community participation. Here’s how it works. Users buy Horn tokens and then vote on which issues should be included in the fund. While most everyone knows Space X, there are more than 150 such companies that are Unicorns or close to the $1 Billion mark that are all good candidates for IPO. Many of them will never go IPO because they will be bought by larger companies (but that is a positive event for shareholders too). The voting system will reward more intelligent votes with a higher allocation of tokens, so for example if you vote for Space X and it ends up being the biggest winner, you will receive more tokens than if you vote for Uber and it ends up bombing.
What is unique about this model is that it’s simple – it can be explained in a few minutes. There’s no moving parts – it’s just as simple as that. It basically opens up access to companies like Space X to investors through the use of a token they are calling HORN. Token investors should love it. Wall St. investors, maybe not. Because they can get access to these companies directly or through the brokerage services like PTN. But what Cornucopia does is it tokenizes the offering – and it’s all wrapped into one token. In the future, there will likely be other similar tokens but for now, this is the only one. HORN is the only token offering pre-IPO mature companies to token investors.
We are not claiming here that Cornucopia has done anything new or unique – on the contrary, they have taken the pre-IPO model which is now very popular on Wall St. and tokenized it. The underlying ratings system, powered by Ignite Ratings, incentivizes users to participate in the process because they will be rewarded for doing so (and rewarded more for making better decisions).
Many have been claiming that Wall St. tokens are coming – while this doesn’t represent Goldman Sachs (GS) coin, this is a Wall St. model that will certainly attract copycats. Cornucopia doesn’t have a patent on this model nor would it be possible to patent a ‘business model’ – but as with any new standard, he who makes the standard has the most to gain from it (such as HORN token holders).
To compare this to other token offerings in the financial sphere, few can compare. For this reason, we believe that Cornucopia is going to make a big splash, and have no problem raising their $15 Million hard cap.
Lastly, let’s take a look at our favorite component (or potential component) to HORN – Space X. This is a bit of a controversial company, but we like it. We want to explain why – and then conclude that HORN is a great way to get exposure to Space X and other companies.
Since World War 2, which was the first time the United States invested massive resources in research and development of technology, the US Military has been a world leader in technology research and development, mostly led by DARPA, but also CIA, NSA, Navy, Army, Air Force, et. al. all working under the Director of Central Intelligence. The types of research projects are so vast we would need a library of books just to dig into them, covering all fields of science and even pseudo-science. If there was a guy who could bend spoons, the CIA had a guy there looking into it. Those who are interested in this topic can watch George Clooney’s “The Men who Stare at Goats” for some of the more bizarre and paranormal research experiments. The strategy is simple really – fund thousands of projects with more budget than needed and get the best minds in the world and even if 9 out of 10 projects fail, the 1 out of 10 that work, they will create something like the Atom bomb. The Manhattan project was perhaps the most ambitious and purposeful research effort in human history, the success of which won the war. Because of this, Military leaders understood the value of advanced weapon technology and this ethos is in the Pentagon to this day.
There is one side benefit for Corporate America to this strategy. Once technology has become ‘declassified’ and where there is clearly no military use, the technology is leaked to corporations (for free) and ultimately sold to the public. Most of what Silicon Valley has ‘invented’ can be credited to this cozy relationship. Technologies are leaked via research labs like ‘SPARC’ labs and others. Companies like XEROX, IBM, Microsoft, Apple, and recently Google and Facebook, participate in these programs.
Often how they acquire the technology is overlooked by investors, but it really is irrelevant, the US Military is not a for profit business per se, like many parts of the US Government it enables for-profit commercial enterprises to profit. As US Citizens are the indirect owners of this IP, transferring it to Corporations that are mostly in the average American’s 401k is widely appropriate (plus it stops the question ‘where all this money is going?’)
Due to the secret nature of much of this technology, this transfer is not something widely publicized – but we can see tangible benefits such as the internet itself, actually designed and built by the US Military. Space X has contracts for delivering rockets and launching them – but do they have something more? We have developed a hypothesis based on nothing other than the previous behavior of this relationship between the Military and Big Business – dating back to the 70’s, 80’s, and 90’s. Space X could have been the recipient of some of this IP, and if they were – it wouldn’t be something they could say publicly. This could explain Musk’s wild claims and his arrogant behavior (because if he had one of these transfers, it would make any competition impossible). One bright example is provided by the potential uses of Helium 3 as an energy source. Everyone knows and widely discusses about Oil – it’s use and utility for military purposes. But this is really a simplistic explanation for common folk to understand the larger doctrine, that energy is a key military resource – perhaps the most important.
For this reason, the US Military not only collects intelligence on new energy systems, but engages in their own research on potential alternative energy sources, such as “Zero Point” energy, Thorium Reactors, and Helium 3. Helium 3 only exists in places such as the moon and is difficult to extract and refine. If Space X had a way to do it, it will in 5 or 10 years be the biggest company on planet Earth. We do not have information to back up that statement it is a hypothetical mind experiment, to show the logic based on our hypothesis. There may be a far different story that we don’t know and will not know until it is revealed, however Helium 3 provides a good example of something that if Space X had IP about how to mine it, transport it, and convert it to Energy, it would be so profitable that the valuation of Space X would go parabolic. And if they were able to do it, they would be the exclusive provider.
Some of Musk’s claims such as colonizing Mars don’t really have a direct business benefit – Helium 3 does. If Space X does have such IP, these other businesses such as launching rockets and giving rides to Billionaire’s in space would be irrelevant. And again, this is just a hypothesis, based on history – we have no direct information that this is the case. For those of us who remember things like ‘the internet’ and the ‘Personal Computer’ that came out of nowhere, we remember a group of select companies having access to such technology and running with it. Remember, Apple (AAPL) didn’t invent the PC, they popularized it. Steve Jobs was not a technology guru or an engineer, he was a marketing genius that created a ‘cult of Mac’ based on his leadership and God-like personality he picked up while studying in India. We can agree that Woz was an engineer, but Apple didn’t invent the micro-processor, they were mostly a design and marketing firm that wanted to create a retail product from assembly. This is not a critique of Apple (AAPL) which is the obvious success of the century, but to point out a past example of a company that created an Empire from something they didn’t build or engineer themselves.
This is a ‘long shot’ hypothesis meaning it is a low probability high impact event. If it is true, the announcement of such news would shoot the value of Space X to the Stratosphere. If it is false, Space X would be evaluated based on its current public claims. But one thing is sure, Space X has exclusivity on this niche in the Aerospace/Defense Sector, and there’s only one place to access it with a token: Cornucopia.
Posted: August 2, 2018, 11:44 pm
Bitcoin has had a net negative effect on the perception of Main Street on investing, and a potential huge long term effect on the architecture of markets.  What Bitcoin has created in the short term, is a powerful analogy based on insane assumptions: We have a coin that will be like Bitcoin, and go up 1,000,000 %.  The sad fact, Bitcoins rise has been used as a story to raise capital: This time it’s different.  We’ve built a better Bitcoin.  Our coin will go up more than Bitcoin, so they have been telling us.  But the reality speaks the opposite story, that Bitcoin is likely a one time phenomenon, as even Ethereum, although the design is different, doesn’t come close to Bitcoin. 
Especially since the cross above the psychological 10,000 mark, investors everywhere have been piling funds into ICOs and other concepts claiming to be “The Next Bitcoin – only better” yet so far they have all failed to deliver on their promises, and look likely to continue to do so.  Just like there will never be another Google or Microsoft, there will likely never be another Bitcoin.  If you enjoyed the rise – enjoy your life.  Trying to recreate something again or catch what you missed is a fools errand. 
Some new coins of course are promising, they aren’t all a bunch of garbage – but most are.  All the wrong people decided to launch ICOs for all the wrong reasons.  There have been few quality offerings, so we can mention only a few by name; Basis.. Others which go unnoticed and don’t have the ‘sales pitch’ to capture the wrong type of investors, such as Sky Desks.
What Bitcoin did that was positive it forced the hand of the establishment to innovate.  As the ultimate use-case for digital money that ‘works’ – Bitcoin would never be forgotten or disregarded.  It takes time to build something substantial.  In 2017 we can say that it was the year that the work began.  The fruits of this work may not be seen until 2027 – just as Bitcoin took nearly 10 years to mature into popularity, so will any new Blockchain technology take time.  Regulations will evolve, law will evolve, that will support these more advanced efforts. 
The correct approach to this, is not to identify a single ‘opportunity’ and evaluate it, as one would an investment.  These are ‘stock pickers’ and in the long run this will not work well, statistics show.
The correct approach is to take any advanced idea and foster it – incorporate it into your existing business.  How can I use Blockchain to empower my sales process?  To accept payments from customers?  What else?  Hedging?  Communication?  Security? 
These hopers that think they have picked the next “Bitcoin” are sure to fail if they don’t adopt.  Adoption is what made Bitcoin rise – and it’s the only thing that will make any coin rise.  Ethereum, the only token that has come close – is driven by demand for it’s development platform.  When an ERC 20 token is issued, ultimately users need to first buy ETH in order to buy the underlying.  The coin is likely denominated in ETH (although it’s not an explicit requirement, the majority of ETH tokens are denominated in ETH).
To learn more about Cryptocurrency and real trading and investing opportunities, like Cornucopia, visit

Posted: July 28, 2018, 1:37 am
As we have often explained in our book Splitting Pennies, the world is not as it seems.  Politics often polarizes a country it seems every election there becomes 'two' Americas but the current polarization seems to be that of 'rational' and 'irrational' whereas on one side, there are facts; and on the other, hysterical opinions.  While no evidence was provided that any Russians 'hacked' the mere accusation in absentia is 'proof' for the irrational left that it was the Russians.  "Blame it on the Russians" seems to be the scapegoat story of the day, perhaps lingering from the previous generation that came to power during the cold war.  It's a bunch of nonsense, the entire Russian narrative is a fantasy created by intelligence operatives as a propaganda effort to smear Trump and anyone who doesn't fall into the Leftist/Liberal mindframe.  As any American who has ever been through the justice system in America knows, you are guilty until proven innocent, not the other way around.  Someone can sue you or call the cops and make any false claims and the burden is on you to prove it is false.  If the complaining witness is the US Government itself, you can forget about any 'rights' you may have had or the right to a fair trial (they have immunity and other powers that prevent any fair and reasonable defense if you are targeted).   As usual, these aggressive and toxic forces that are attacking Trump politically from inside the deep-state are exploiting the masses lack of education of history, so we would like to here expose perhaps one of the most important looked over historical facts pertinent to understanding the deep roots of the relationship between USA and Russia.  MUST READ: Wall St. and the Bolshevik Revolution.
Russia was ruled by a Monarchy similar to the rest of Europe until 1917 when the Bolshevik's staged a successful coup of the Kerensky regime thus installing a Soviet Dictatorship run by the Communist Party until its collapse in 1991.
The 1917 Revolution was financed by and orchestrated by Wall St. - Not only did New York bankers provide money, they allowed safe passage to Russia revolutionaries like Trotsky and others by use of diplomatic cover by the US and other governments.  The main character in this play was Thompson, wealthy banker and Chairman of the Federal Reserve Bank of New York.  Most of the bankers had first degree relationships with J.P. Morgan himself (the man, and the firm).  MUST READ: Wall St. and the Bolshevik Revolution.
Although this was reported in the press, at the time, it didn't seem that it required further examination by historians:
William B. Thompson, who was in Petrograd from July until November last, has made a personal contribution of $1,000,000 to the Bolsheviki for the purpose of spreading their doctrine in Germany and Austria ....
Washington Post, February 2, 1918
Of course, the official story is that the "American Red Cross" mission to Russia was a humanitarian effort (but if that was the case, why was it composed of mostly lawyers, bankers, and merchants, and only 2 doctors?) 
To really understand this one must read this book MUST READ: Wall St. and the Bolshevik Revolution.
The world is different now.  The politics of the time was different.  100 years ago, groups such as the Morgan firm would finance any revolutionary in hopes to gain contracts from a newly formed government.  Monopoly Capitalists were the perfect business partners to Communists which operated a state controlled regime.  And they achieved their means, guys like Armand Hammer made vast fortunes doing business with the Soviet Union.  You see, the Monopolists realized that the best market was one that was controlled.  In the example of Russia, consumers had no choices.  So if you sold shoes or pencils to the Soviet Government, you sold to all consumers (they had no choice).  It was one big customer that always paid on time.  There was no advertising.  No consumer protection.  It was a Monopoly Capitalist's wet dream.  And, remember that in this time America was undergoing massive consumer protection reforms that were not present during the previous century.  
The bankers who financed the Bolshevik revolution had no interest in politics, in Russia, or in 'helping people' - they wanted big juicy government contracts from Dictatorships.  Because in a Dictatorship, the Dictator and his friends make the rules (as in LATAM countries).  
But does the world still work like this?  It seems so, as Putin claimed in his recent meeting with Trump about Bill Browder, a guy who made unknown fortunes (Billions) in the wild times in the 90's in Russia and paid no taxes.  Then he uses his influence to buy politicians, create laws, and is a major financier behind the Russophobia campaign.  That's how these creeps use politics for gain, guys like Soros who know how to grease the palms of the wrong people to do their bidding and profit.  They only need to trick 30% of the population to create a critical mass of support, as most of their advertising efforts fly in the face of truth and reason.  But it's enough, to create a political divide and start a discussion in the wrong topic.  Since Trump has been 'defending' himself on the Russia collusion issue, it has been difficult to do anything else.  They have used this Russia topic as a stale fish to let rot in the market for days after it has spoiled, preventing any customers from coming close to the market even to discuss other issues.  
The take away here is, the deep state has existed for 100 years, as referenced by this book MUST READ: Wall St. and the Bolshevik Revolution..  Here we are just elaborating this historic fact, how the Elite manipulate the system for the benefits of the haves and to the detriment of the have-nots.  Browder, Soros, and others like this stand in the way of real democracy, as their real dream of a democracy is that of a Dictatorship with the illusion of Democracy (fixed voting machines).  As Trump attempts to 'drain the Swamp' he must confront these demons which he did in his recent meeting with Putin.  Ironically, Putin is at the end of a similar campaign in Russia in which he attempts to flush out corruption in Russia which although still widespread is on the decline.
Readers - don't forget the irony here.  The Soviet Union was made possible by Monopoly Capitalists who later made fortunes trading with them.  During the Cold War the US spent billions in taxpayer money fighting 'Communism' and finally this victory was achieved in 1991 - when the script was flipped and now the Russophobes are against "Russian Mafia" because they are greedy Capitalists!  The US convinced the Russians to be a market economy and are now chastising them for their Oligarch class, and other trappings that come with Capitalism.  Amazing! 
But it is the way of the world, we all have a role to play - and sadly for Russia their role has always been the macabre defender of Western Civilization from the evolving demographic threats whether from the Golden Horde, Third Reich, or ISIS.

Posted: July 18, 2018, 6:05 pm
As we have explained in Splitting Pennies - the global markets are not as they seem.  As we are now all aware, Trump started a trade war which really is the equivalent of a pissing contest (as it mostly is just talk), however it seems as though Trump's heart is in the right place putting America first but he needs to hire better financial advisers as the Chinese are winning this round of the game.  The chart to follow is this, as reported first on Zero Hedge (it seems the mainstream financial media is skipping over this huge glaring super important fact):

What the PBOC (The Chinese Central Bank) has been doing is artificially debasing their currency, thus offsetting any potential tariffs.  Currency Wars are nothing new and they didn't invent anything with this move.  It's simple really, the Yuan is a controlled currency (unlike others that freely float against other currencies) that means the PBOC can basically decide what it wants the rate to be, USDCNH.  So for example if Trump enacts a 20% hike on Chinese imports via tariff or taxes, and the Yuan sinks 20% - for the buyer the product is the same and likely nothing would change.  These buyers, like Home Depot for example, Wal Mart, and others - they are very sensitive about small thin margins.  An extra 1% would cause them to shop the deal.  Practically, there are hundreds of alternatives, but China has built their economy as a wholesale dumping ground where there are absolutely no labor laws, environmental controls, or other standards how their products are made, so that it really is cheap crap.  
I'd like to use an example from the real world not connected to this China problem.  Recently I visited a Gold Mine which is a tourist attraction in Georgia.  They explained there is plenty of gold there - but due to environmental regulations it would cost much more (twice or more) the current Gold price to extract it, whatever the number doesn't matter but let's say it's 5,000 Oz from this mine, if we follow all the rules and regulations.  In South Africa, in Russia, and many other places - they have no such rules.  So they are poisoning the environment!! Those jerks.. but who can stop them?  You don't see environmental protests in Red Square, liberals throwing red meat on Oligarchs as they leave posh hotels.  
The point is - considering all these costs - what is the REAL Price of the iPhone?  5,000 ? If made in USA.  Here's the problem with Trump's strategy.  And this statement is not a solution it is merely intended to elaborate on how complex this issue really is.
The FANGs have built an entire business out of being able to build cheaply without rules.  If we stripped away all that advantage, their stocks would look more like utilities.  Perhaps that is as it should be.  When investors buy Apple (AAPL) they think of technology, they think of innovation - they don't think of exploitation of child labor, forced slave labor, workers who commit suicide the conditions are so bad.  They don't consider the environmental cost (which is also ironic considering their liberal leftist base).
In Trump's trade war, we are talking about leveling the playing field.  We want to bring those jobs back home - back to Main St. 
"Make it on Wall St. - Spend it on Main St." used to be the saying.  But now it's more like "Make it on Wall St., spend it in China, Bermuda, anywhere but USA - just get the money out!"
Tax havens, cheap manufacturing bases, and other excuses have bled America dry of capital.  QE and the policies of the Fed have made the 1% even more rich - but have done nothing positive, in fact have acted more like a leech - to the real economy.  The banks didn't lend post crisis.  The rich didn't spend (at least as to help the real economy) and were so greedy that with a few token exceptions they likely made the problems worse.  This led to skyrocketing unemployment (now they are calling it 'underemployment'), opioid epidemics, explosion in crime, violence, roads and bridges in major need of repair, deterioration of schools and finally the creation of the mutant fakebook generation that has no skill other than posting to their wall.  Yes, all the problems, the bankrupt cities, deterioration of institutions, civic society - can all be laid to blame on decades of economic policies that have made USA rotten from the inside out.  Globalists have bought and sold all elements of American life and Trump is trying to reverse that.  If successful, which in the best case can take many years, we can hope for the 50s and 60s but with the benefits of technology.  Those who either are the 1% AND those who are too stupid to understand this economic analysis which you really don't need a high IQ or an economics degree to understand, represent the anti-Trump movement, and they will do anything to maintain their status quo.  
The Elite have led a bad example, not to single anyone out but here's one Mayor that really shouldn't act like this: Bloomberg.  Here's a guy who spends his free time in another country golfing and eating steaks.  While the news agency that carries his name slowly deteriorates into a liberal political tool (from what was once the only unbiased business and finance media in the world) promoting the agenda of whoever pays the most, Bloomberg is the mayor of New York but spends his spare time in Bermuda.  He's a public figure but the point is that most of the Elite are like this.  They look at America as a cash cow, certainly it's not a place you want to spend your weekends.  Why would you?  Been to the Bronx in the summer lately?  It's a heat island.
This is non-political economic analysis - the elaboration here is to demonstrate the forces at work here.  Trump is trying to take back this unfair advantage which is being exploited by: Foreign Countries, US Corporates (some, not all), the Elite, Banks, et. al.  But just like a gambler who has a winning ticket every day at the casino - if you one day tell him that his ticket is no longer a winner - of course he will react negatively, he'll sue your casino he'll do anything in his power to get back his winning ticket!  So we can expect a real push back on such policies, the most logical and rational is the Currency devaluation promulgated by the PBOC.
We can't stop environmentally devastating Gold mining in Russia - but we can set economic examples for fair business that's pro-USA.  In fact this laptop I'm writing on is made in Delaware (Eluktronics).  The BMW you drive may have been made in Spartanburg, South Carolina.  This move isn't about China vs. USA or "US vs. THEM" it's about restoring free trade to normalcy.  USA is currently giving the rest of the world a free ride (or a considerably cheaper one).  
The problem however is in the delivery.
Trump needs stronger economic advisors.  Larry Kudlow is well represented in a Clownocracy which Trump has created in his reality show, but has little understanding of macro economics and is in deep need in lessons in Mathematics.  They all have USA's interest #1 they aren't enemies they are just misinformed.  Trump may be a master negotiator and a top actor in a TV show which makes him a perfect candidate to be President but he is not a Quant nor a Gekko.  Where is Paul Volker?  Why aren't interest rates above 10%?  If Trump wants to SMASH China where it hurts all that needs to be done is raise rates.
As it stands, all of this commotion in Washington is being muted by PBOC manipulation of the USD/Yuan rate.  In order to stop this, there is one simple order: Raise rates 5%.  There are 2 sides to every coin.  As a Global Reserve Currency it's not possible to play in Yen and deflate / debase your way into exporter heaven.  For a strong country that wants USA first, aggressive rate hikes are the only way to stay ahead.  That's not likely to happen.  Of course there is an alternative route - lowering rates to ZIRP again allowing more cheap money to flow into the system (but it hasn't worked in the past and will not likely achieve anything).
This article is not meant to suggest economic policy, simply to elaborate that the Chinese are winning this round by simply devaluing their currency and they can continue to do so the higher the tariffs are raised.  So if Trump enacts a 50% tax on Asian imports it will be irrelevant if the Yuan is devalued by another 50%.  Capiche?  
Posted: July 3, 2018, 2:24 am
The Crypto Market isn't all it's cracked up to be.  Last year we wrote a book on this topic, Splitting Bits (you can get it here).  But the book was written in October, before the huge rise in price in November and December.   Just like with traditional markets - investors only seem interested in the winners.  When we said that 90% of ICOs are frauds - did anyone really hear that?  Or were they just 'listening' ?
As the digital money frenzy of the past few years cools, the crypto coin graveyard is filling up. Dead Coins lists around 800 tokens that are bereft of life, while Coinopsy estimates that more than 1,000 have bought the farm.
The carnage is mostly the consequence of failed projects from the thousands of startups that used initial coin offerings to raise billions in funding, and a global regulatory crackdown on questionable practices and scams. Names like CryptoMeth, Droplex and Roulettecoin may have been a clue to the coins’ dim prospects.
“There has obviously been a lot of fraud and hype in the ICO market,” Aaron Brown, a business author and investor who writes for Bloomberg Prophets, said in an email. “I accept figures I have seen that 80 percent of ICOs were frauds, and 10 percent lacked substance and failed shortly after raising money. Most of the remaining 10 percent will probably fail as well.”
While everyone is watching Bitcoin, many forget about the thousands of failed projects, frauds, and other failed ICOs that didn't meet the mark.

While this may seem like an obvious statement, with all the hype - some need a reminder of this.  As they say in Israel, most projects are 'shitcoin.'  Oh you think this is another joke, do you?  No no no... no no no .. it's not.
This is a great example of what comprises the majority of the Crypto Market.  Now of course, not all coins are shit coins - in fact many show signs of promise.  And also, not all ICOs are crap, there are those that actually have an underlying technology which look very promising, such as Sky Desks, Cornucopia, and others.  Some from the 'real world' are finding no trouble raising money, that is - coins that actually have viable business models - such as Box Bit.  Consulting companies are popping up everywhere.

But going back to SHIT, it really is wide spread.  So few ICOs are regulated, in fact there is only one 'official' regulated ICO and it's not an ICO it's an STO (Securities Token Offering) tZERO.
It seems that there is only one coin, that everyone agrees (at least the market) is good - and that's Bitcoin.  But yet, we don't know who created Bitcoin, even though the NSA said they can't say if they created it as this is classified (classic!).
Millions of people around the world are trying to start their own coins.  Platforms like Waves allow you to do this in a few minutes after paying the ETH fee.  But what value does a coin have which can be created in the equivalent of Microsoft Money?  
You know that many of us were not born yesterday, so we're not falling for the banana in the tailpipe.

It can be you!  Just liquidate your 401k and invest in the next 'Bitcoin' - which you probably have a friend who told you what it's going to be.  WARNING - THIS IS SARCASTIC HUMOR.  CRYPTO INVESTING IS RISKY AND YOU SHOULD ONLY INVEST FUNDS IN WHICH YOU PLAN ON LOSING IN ORDER TO OFFSET YOUR MASSIVE TAX BILL ON YOUR BITCOIN GAINS YOU HAVE CARRIED FORWARD SINCE 2017.
Posted: June 29, 2018, 6:59 pm
The New York Department of Financial Services (DFS) has fined the bank for unlawful, unsafe and unsound behaviour in its foreign exchange trading business
Deutsche Bank agreed to pay the fines for violations of New York banking law that included, among other things, skewing prices and misleading customers.
The violations were discovered during a DFS investigation, which found that the bank had acted improperly between 2007 and 2013, during which time it was the largest foreign exchange dealer in the world.
The behaviour by traders included use of multi-party chat rooms to coordinate activity and share confidential information, misleading customers on benefits of the bank, and manipulating foreign exchange currency prices and benchmark rates.
“Due to Deutsche Bank’s lax oversight in its foreign exchange business, including in some instances, supervisors engaging in improper activity, certain traders and salespeople repeatedly abused the trust of their customers and violated New York State law over the course of many years,” said DFS superintendent Maria Vullo.
She added that inadequate supervision could pose risks to the “soundness of an institution” and that compliance failures can lead to procedures harmful to customers and markets.
Vullo added that she appreciated the bank’s full cooperation and its internal investigation.
The bank will now provide plans on enhanced internal controls, an internal audit and a compliance risk management program in regards to its foreign exchange trading business.
In April, Mark Johnson, former head of HSBC Bank foreign exchange cash trading in the US became the first person to be imprisoned as part of a global crackdown on currency rigging.
 Deutsche Bank has been contacted for comment.
Posted: June 27, 2018, 2:24 am


The world forgot about the tZERO ICO.
tZERO recently announced a partnership with BOX Digital Markets.
They raised $250M, reaching their goal (according to sources).
There is nothing stopping tZERO and OSTK from a 10x or 20x return.
The crypto market has cooled down, with some sites indicating that the market is down to $268 billion market cap (total, including all coins). There is no debate that Bitcoin has failed to meet the hopes of many (that it would go to $100,000 or higher) - it has failed. The hopers and the HOLDers are still hoping and HOLDing, while major enterprise grade projects are taking shape in the crypto community, the most prominent and significant being the tZERO token trading platform, and we will explain why here.
First let's understand why this recent news is significant:



Posted: June 19, 2018, 5:50 pm
We've been closely watching the Crypto Currency Market if you can call it that, with all the fake data, fraud, and related problems.  One thing stands out - it's not so different than FX, commodities, futures, or stocks.  Market dynamics are market dynamics.  And as most readers of this fine site will already know - the majority of traders lose.  There's been analysis done on this, we all know how this ends.  A few early investors make a bundle and thousands or millions even are left holding the bag.  From one perspective, a bubble is much like a ponzi scheme.  In MLM, there are a few who get rich - the founders.  
Unless you are the founder - how do you know which Crypto is going to be the next Bitcoin?  You really don't.  You have no clue.  You can go to Korea and do all the due diligence you want, the fact remains that no one can see the future and even a top analyst can be wrong at times.  
Quant traders have a similar doctrine they all share - they are smart enough to know how stupid they are.  They know their own flaws and they submit to a higher power- that is Artificial Intelligence.
Computing power is now so massive that it is possible that anyone can from their own home office create an intelligent trading system that does well.  Of course, as with the laws of market dynamics, it's also possible to create a robot which is worth exactly zero - a big pile of crap.  When a quant makes an algorithm it's either priceless or worthless.  If it works, he has effectively created a money making machine.  If it doesn't work, there isn't any value to anyone not even academics.
So how do you know what method works, how to build a working bot or buy one?  There are obvious conflicts of interest in those who sell bots.  The internet has been dominated by good marketeers, while profitable quants mostly keep their strategies to themselves.  Selling a product, and trading a robot, are really 2 different skills.
Crypto so far has proven the same as most markets: impossible to trade.  Just look at this chart and tell me where you would have entered and exited without the foreknowledge of what is actually going to happen:

While many are kicking themselves for not buying and holding, I can tell you as a trader and I speak for many in the room that there is no way I would have had the patience to sit on a hugely profitable position for 3 years while the price goes parabolic.  
That's why quants develop and trade algorithms - picking entries and exits can prove to be brain-destroying.  There are dangers and risks with robots too of course, but they are of a different nature.
Choose your bot @   ANNOUNCEMENT:  ROBOTS WANTED!  List your robot for free - connect to Handy the trade copy bot and let do all the work for you.

Posted: June 18, 2018, 11:36 pm
Bitcoin and other cryptocurrencies flash-crashed Saturday night, one day after the US Commodity Future Trading Commission (CFTC) sent subpoenas four cryptocurrency exchanges in an ongoing probe into bitcoin manipulation that began in late July - following the launch of bitcoin futures on the CME, according to the Wall Street Journal
CME’s bitcoin futures derive their final value from prices at four bitcoin exchangesBitstamp, Coinbase, itBit and KrakenManipulative trading in those markets could skew the price of bitcoin futures that the government directly regulates.
In delay reaction, Bitcoin fell as much as $433 or 5.6% in Saturday night trading, with some noting that the flash crash happened shortly after a 90th ranked crypto exchange, Coinrail, had suffered a "cyber intrusion", and was likely the more relevant catalyst for the crypto price drop.
While major Cryptocurrencies were down from 4.5 - 5.5%, Bitcoin Cash dropped over 8.4%. 
The CTFC subpoenas were issued after several of the exchanges refused to voluntarily share trading data with the CME after being asked last December. Of note, the CFTC regulates the CTC. 
According to the WSJ, the CME, which launched bitcoin futures in December, asked the four exchanges to share reams of trading data after its first contract settled in January, people familiar with the matter said. But several of the exchanges declined to comply, arguing the request was intrusive. The exchanges ultimately provided some data, but only after CME limited its request to a few hours of activity, instead of a full day, and restricted to a few market participants, the people added.
What is curious, is that if there was indeed manipulation since the launch of bitcoin futures, it was to the downside, as the price of cryptos peaked around the time the crypto futures were launched, and are down well over 50% in the 6 months since.
Coinbase in particular has been under the watch government regulators. On February 23, Coinbase sent an official notice to around 13,000 customers to notify them they were legally required to turn over their information to the IRS
The IRS had initially asked Coinbase in July 2017 to hand over even more detailed information on every one of its then over 500,000 users in an attempt catch those cheating on their taxes. However, another court order in Nov. 2017 reduced this number to around 14,000 “high-transacting” users, which the platform now reports as 13,000, in what Coinbase calls a “partial, but still significant, victory for Coinbase and its customers.”
Coinbase told the around 13,000 affected customers that the company would be providing their taxpayer ID, name, birth date, address, and historical transaction records from 2013-2015 to the IRS within 21 days. Coinbase’s letter to these customers encourages them “to seek legal advice from an attorney promptly” if they have any questions. Their website also states that concerns may also be addressed on Coinbase’s Taxes FAQ. The ongoing legal battle between Coinbase and the US government dates back to November, 2016, when the IRS filed a “John Doe summons” in the United States District Court for the Northern District of California.
On Feb. 13, personal finance service Credit Karma released data showing that only 0.04 percent of their customers had reported cryptocurrencies on their federal tax returns. 
And in April, former New York Attorney General, Eric "we could rarely have sex without him beating me" Schneiderman, launched a probe of 13 major cryptocurrency exchanges according to the Wall Street Journal - claiming that investors dealing in the fast-growing markets often don’t have the basic facts needed to protect themselves.
Former AG Schneiderman’s office said the program, called Virtual Markets Integrity Initiative,  is part of its responsibility to protect consumers and ensure the integrity of financial markets, and its goal is to ensure that investors can have a better understanding of the risks and protections afforded them on these sites.
CFTC Commissioner: Crypto is a "modern miracle"
While the CFTC, IRS and New York Attorney General's office are all cracking down on cryptocurrency exchanges, it seems to all be part of the government's embrace of virtual currencies.  Last week CFTC Commissioner Rostin Benham called cryptocurrencies a "modern miracleat the Blockchain For Impact Summit held at the UN in New York last week. 
But virtual currencies may – will – become part of the economic practices of any country, anywhere.  Let me repeat that:  these currencies are not going away and they will proliferate to every economy and every part of the planet.  Some places, small economies, may become dependent on virtual assets for survival.  And, these currencies will be outside traditional monetary intermediaries, like government, banks, investors, ministries, or international organizations.
We are witnessing a technological revolution.  Perhaps we are witnessing a modern miracle. -Rostin Benham
Rostin hinted at the upcoming legal action against the exchanges during his speech:
Under the CEA and Commission regulations and related guidance, exchanges have the responsibility to ensure that their Bitcoin futures products and their cash-settlement process are not readily susceptible to manipulation and the entity has sufficient capital to protect itself.  The CFTC has the authority to ensure compliance. In addition, the CFTC has legal authority over virtual currency derivatives in support of anti-fraud and manipulation including enforcement authority in the underlying markets.

Meanwhile, the official Bitcoin website removed references to Coinbase, and Bitpay, according to Crypto News - only one of which, Coinbase, was subpoenaed.  just removed/censored the 2 largest US Bitcoin companies (@BitPay Payment processing and @coinbase Bitcoin Exchange). It’s a good move: Bitcoin Core is obviously no longer Bitcoin, and should ideally be removed from both @BitPay and @coinbase too.

The CFTC officially recognized bitcoin as a commodity in September of 2015 when it went after Coinflip for operating a platform for trading bitcoin options without the proper authorization. Since the agency effectively asserted its dominance over the bitcoin market with that decision, this is the first time it has given its blessing to an bitcoin options trading platform. Expect a burst of institutional trading activity to follow - especially since they approved institutional options trading in July
This post sponsored by Total Cryptos @  
Posted: June 10, 2018, 8:13 pm
The Justice Department has opened a criminal probe into whether traders are manipulating the price of Bitcoin and other digital currencies, dramatically ratcheting up U.S. scrutiny of red-hot markets that critics say are rife with misconduct, according to four people familiar with the matter.
The investigation is focused on illegal practices that can influence prices -- such as spoofing, or flooding the market with fake orders to trick other traders into buying or selling, said the people, who asked not to be identified because the review is private. Federal prosecutors are working with the Commodity Futures Trading Commission, a financial regulator that oversees derivatives tied to Bitcoin, the people said.
Authorities worry that virtual currencies are susceptible to fraud for multiple reasons: skepticism that all exchanges are actively pursuing cheaters, wild price swings that could make it easy to push valuations around and a lack of regulations like the ones that govern stocks and other assets.
Bitcoin extended its Thursday declines after Bloomberg News reported the investigation, and was down 3 percent to $7,409 as of 9:32 a.m. London time. It’s down more than 20 percent since a May 4 peak.
Such concerns have prompted China to ban cryptocurrency exchanges and nations including Japan and the Philippines to regulate them, contributing to a slump that has sent Bitcoin below $8,000 this year. Still, digital coins continue to be a global investment craze, drawing legions of loyalists to industry conferences, generating celebrity endorsements and increasingly attracting the attention of Wall Street.

Traders Colluding?

The illicit tactics that the Justice Department is looking into include spoofing and wash trading -- forms of cheating that regulators have spent years trying to root out of futures and equities markets, the people said. In spoofing, a trader submits a spate of orders and then cancels them once prices move in a desired direction. Wash trades involve a cheater trading with herself to give a false impression of market demand that lures other to dive in too. Coins prosecutors are examining include Bitcoin and Ether, the people said.
A Justice Department spokesman declined to comment and CFTC officials didn’t respond to requests for comment.
The investigation, which the people said is in its early stages, is the U.S.’s latest effort to crack down on an industry that was initially embraced by those who were distrustful of banks and government control over monetary policy.
But Bitcoin’s meteoric rise -- it surged to almost $20,000 in 2017 after starting the year below $1,000 -- has been a lure for mom-and-pop investors. That’s prompted regulators to grow concerned that people are jumping into cryptocurrencies without knowing the risks. For instance, the Securities and Exchange Commission has opened dozens of investigations into initial coin offerings, in which companies sell digital tokens that can be redeemed for goods and services, due to suspicions that many are scams.
Cryptocurrency trading is fragmented on dozens of platforms across the globe, and many aren’t registered with the CFTC or SEC. As a derivatives watchdog, the CFTC doesn’t regulate what’s known as the spot market for digital tokens -- which is the trading of actual coins rather than futures linked to them. But if the agency finds fraud in spot markets, it does have authority to impose sanctions.

Fraud Target

The limited oversight of crypto trading makes it a target for crooks, said John Griffin, a University of Texas finance professor who has studied manipulation, including in digital-coin markets.
“There’s very little monitoring of manipulative trading, spoofing and wash trading,” Griffin said. “It would be easy to spoof this market.”
Signs are emerging that some crypto exchanges realize the industry’s growth could be constrained if large swaths of investors conclude that trading platforms have a “buyer beware” approach to oversight.
Cameron and Tyler Winklevoss
Photographer: David Paul Morris
The Winklevoss twins, who are known for getting rich off Facebook Inc., hired Nasdaq Inc. last month to conduct surveillance of digital coins trading on their exchange, Gemini Trust Co. Cameron and Tyler Winklevoss have also urged trading platforms to band together to form a group that would serve as a self regulator for the industry.
Some market participants have alleged that crypto manipulation is rampant. Last year, a blogger flagged the actions of “Spoofy,” a nickname for a trader or group of traders that have allegedly placed $1 million orders without executing them.

Posted: May 24, 2018, 12:40 pm
(Bloc10 - 5/3/2018) - Bloc10, a Blockchain FinTech development and management company, has released a free software tool for Windows and Mac "Blockpad" get it free at Blockpad is a private encrypted personal ledger, notepad, password manager, secure browser to access exchanges, one time pad, and more. Blockpad is an ultra-secure environment by design, using multiple layers of security based on AES-256, a Cryptographic technology so secure, the NSA has stated it is sufficient to keep TOP SECRET information secure: The design and strength of all key lengths of the AES algorithm (i.e., 128, 192 and 256) are sufficient to protect classified information up to the SECRET level. TOP SECRET information will require use of either the 192 or 256 key lengths. The implementation of AES in products intended to protect national security systems and/or information must be reviewed and certified by NSA prior to their acquisition and use.[15] Blockpad is the Notepad for Crypto Traders, Blockchain Developers, Coders, Intelligence Operatives, Crypto Investors, et. al. Blockpad is a multi-use encrypted notepad secured with AES-256 and 2FA. Main features include code highlighting notepad for code writing, task list, document creation; keeping account usernames and passwords to Crypto related accounts securely in one place; and a Coin Records personal encrypted ledger to record coin transactions in an independently secured and controlled system. All the content in Blockpad is encrypted in a .bloc file accessible only with user credentials and 2FA. Blockpad is freeware with a paid option; Blockpad Premium is $1.99/month and offers more features, no ads, encrypted cloud backup of your .bloc file, premium skins, and an online recovery system. With security in mind, Blockpad can help you stay organized by keeping track of coin transactions, passwords, account credentials, and more. Blockpad is an application written in QT by Bloc10, a software and technology development company. It is available for Windows, Linux, Mac, Android, and iOS. With Blockpad's secure account tab, you can save all your passwords in one encrypted place. Unlike other password applicaitons, Blockpad is encrypted with AES and protected by 2FA which you can setup as complex as you'd like. There is even a timer that will lock the application after x minutes in case your curious roomate or office worker is snooping around your desk.  get it free at Perhaps one of the most useful writing applications and the most ubiquitous of the Windows generation has been Notepad++. It has a ridiculous amount of features, is useful in many ways, and is free. It will open files Windows notepad doesn't, such as large files that can cause memory issues in Windows notepad, and types of binary files with no extension. Basically Notepad++ is the most basic programming tool as it allows the creation and manipulation of simple text files. Programming environments such as Microsoft Visual Studio and other IDE are enhanced 'cockpit' environments but at the end of the day for programming all you need is a notepad and a compiler. Notepad++ is a limitless text editor and stops short of offering only compiling tools (and this is a logical and rational design decision as it remains in its own exclusive domain).  get it free at Enter Bitcoin and Blockchain in the Fall of 2017 when everything is moving 'on-chain' and suddenly people are opening Crypto trading accounts at record paces. As with many new paradigms, the hype and excitement ran far infront of development; few useable robust tools exist for Blockchain development. Crypto trading is another area where there is more interest than there is robust tools to support it. "Exchanges" often fail in simple functions like 2FA, account reporting, logging in, money transfers, and it's mostly web based. Users who are not programmers or technical people are left only to trust friends who are. Unlike in traditional banking where everything is made for 'moms and dads' - in the Crypto world, not. So we developed Blockpad, it's a multi-use Notepad tool, we hope it is the Notepad++ of Crypto.  get it free at It's free, it's safe, and it's fun! Blockpad has multiple uses:
  • As a secure notepad, for taking notes, or for programming Solidity, or your website.
  • As a secure private ledger, for recording your Crypto transactions.
  • As a store of account usernames and passwords, including 2FA info.
Everything is encrypted, you can't open Blockpad without creating an Encrypted .block file using AES. We digitally signed it so Windows should recognize it. Now we're releasing the Beta version and will work on a cloud backup solution and premium version. Stay tuned in for more updates by joining Bloc10 for free. Get bloc.  get it free at blockpad
Posted: May 4, 2018, 12:57 pm
Billionaire Peter Thiel’s venture-capital firm is investing a startup designed to optimize block trading for major cryptocurrency market participants.
The Wall Street Journal reports that Founders Fund is among the investors in the early-stage startup, called Tagomi Systems Inc., people familiar with the situation said.
Thiel's investment comes after it was revealed that Founders Fund itself has already made a "monster bet" on bitcoin.
It also confirms Thiel's bullish view on bitcoin reported in October last year when the billionaire investor argued that critics of bitcoin were "underestimating" the cryptocurrency.
“If bitcoin ends up being the cyber equivalent of gold and it has a great potential left and it’s a very different kind of thing from what people in Silicon Valley focus on—companies, not algorithms not protocols, but this might be maybe one exception that is very underestimated,” the Silicon Valley elite said.
And, in March, he said there will ultimately be only one digital equivalent to gold, and bitcoin, as the "biggest" cryptocurrency, will triumph.
The question with something like bitcoin is whether it can become a store of value. And the thing it would replace is something like gold. The analogy is it's like bars of gold in a vault that never move and you get it and it's a hedge of sorts against the whole world falling apart."
"The objections that people have to bitcoin are also objections to gold. It's this weird currency that's not backed by any government. Same thing is true of gold. It's not clear what the intrinsic value of bitcoin is. Same thing is true of gold. It may well be a bubble, but - and most bubbles are unstable and end - one of my friends has this line that 'money is the bubble that never pops', so if it is a bubble, then it is money."
"If everybody decided that a $100 bill was worthless then you wouldn't want to have a $100 bill."
According to The Wall Street Journal, the problem that the new startup aims to solve stems from a fragmented trading environment across global cryptocurrency exchanges, where, for instance, the price of bitcoin can vary between platforms. As such, the startup - co-founded by Greg Tusar, the former chief of electronic equities trading at Goldman Sachs - is building a platform that finds the best market to execute large numbers of cryptocurrency trading orders at a specific time.
Currently, buying or selling large quantities of digital currencies is tricky because the market is fragmented across more than 100 crypto exchanges around the world. Connecting to all of them requires setting up a separate account with each one, and crypto exchanges generally impose limits on daily flows in and out.
That makes it cumbersome and time-consuming to pull off a big trade, and the price of a digital currency can move dramatically before the investor finishes buying or selling.
Tagomi hopes to make it easier to make such bulk trades by borrowing a page from the stock market. In U.S. equities, broker-dealers use systems called smart order routers that dispatch their clients’ buy and sell orders to various venues, including a dozen exchanges and more than 30 off-exchange “dark pools.”
These routers make rapid-fire decisions about which market is the best place to execute a trade at any given time. Tagomi is looking to develop a similar tool for the crypto markets, according to people with knowledge of its plans.
It certainly seems clear that Thiel is making a bet (size of the bet has not been reported) that institutional interest is expected to increase dramatically in cryptocurrency trading.
Posted: May 3, 2018, 12:08 am
(Bloc10 4/29/2018) -- This is a macro-deep-analysis of how Crypto can create a new parallel system by feeding off the old carcass of the dying fiat central banking model.
As we explain in our book Splitting Pennies – the financial world is not as it seems. Gurus from many, non-correlated financial disciplines have been predicting for years that the current financial system is going to collapse.  But just like Planet X that never came, and the false alarm of the Y2K bug, it seems that collapse has been postponed.  There’s an answer for this, that isn’t being reported in the financial media.  We must look at the whole picture here, so think macro, think global, and read carefully.  First let us state plainly that this collapse theory is all based on solid data – the debt bubble, over leveraged banks like DB who is 50:1, growing stagnant economic growth, etc. the list of apocalyptic economic data goes on and on – so what’s keeping the system afloat?  Greed? There is one difference and it’s a big difference, a huge one, that all the doom and gloomers need to consider.  It’s not a ‘this time it’s different’ argument, but we have to consider global system dynamics and how they were different in Rome and other ‘empire collapse’ metaphor scenarios; today there are powerful Artificial Intelligence systems that are so powerful, they can out think any opponent 10 moves ahead.  Perhaps it is this intelligence that suggested the creation and proliferation of Bitcoin to replace the economic position that traditional fiat banks failed to provide?  If you look at the system as a whole, Bitcoin is an extremely intelligent solution to economic decay that Quantitative Easing alone cannot solve (and QE has proven to be impotent). Facebook is at the end of it’s use cycle.  Perhaps the most important Fakebook article here on ZH is this one:
"Every part of this has made me sadder and sadder and sadder. I feel like my baby has turned out to be something horrible, and these people I trusted and helped along have forgotten where they came from," he said in a conversation with Kevin Delaney, Quartz’s editor-in-chief.  McNamee has become an outspoken critic of the company, comparing its role in the 2016 US election to "the plot of a sci-fi novel" while at the same time admitting that he has "profited enormously" by backing Facebook early on. The organization he helped found, the Center for Humane Technology, has made it a mission to expose Facebook’s multiple flaws, and to try to fix them.
How is Fakebook related to Crypto?  You should have read Michael Lewis’ The New New Thing – A MUST READ.  These ideas are not dated.  Silicon Valley, Wall St., and DC still operate in this way. Fakebook created a massive bubble out of nothing, 462 Billion as of today.  Facebook isn’t anything, they don’t build anything, they are just programming the minds of the less gifted and in the process keeping tabs on what their neighbors feed their dogs.  Here’s what one Fakebook insider had to say:
During his talk, he echoed criticisms by early Facebook executive, Chamath Palihapitiya, who compared Facebook to “Internet crack” and said it’s “ripping apart the social fabric of how society works.”
Fakebook did it’s job.  It ripped apart the social fabric of how AMERICAN society works.  While Facebook is a global app, it doesn’t have the same significance in other countries.  Perhaps a few US friends like UK, Australia, etc. are in the same boat – but most countries not.  Facebook is from the beginning an intelligence collection apparatus and means of social control, first and foremost.  Incidentally, investors made a bundle on it and it’s a darling of Wall St. (until recently).  Let’s be practical, without InQTel behind it, Fakebook would have never got off the ground.  The CIA needed a slimy weasel like Suckaburger to do their electronic bidding as the spy game globally and domestically was moving to an electronic paradigm.  Don’t forget that the military created the internet, it wasn’t developed by 2 dudes in their mom’s garage.  The internet has always been and perhaps always will be a military communications system used by the public.  There’s a price to pay for ‘free’ networks!  Now of course, there are groups of private networks who have setup peer to peer encrypted communications systems and their own private social networks and chat systems like Telegram, but that represents a small percentage of the overall population which is irrelevant. If we look at Facebook on the surface, for what it is – a pump and dump scheme backed by the Military sold by Wall St. to Main St. to control them and suck more of their hard earned dollars from them, meanwhile keeping tabs on their every move, and making a buck for America’s owners – Bitcoin is the same thing!  Let’s call a kettle a kettle. Bitcoin is popular for one reason – some people made millions on it.  And the people who made millions on Bitcoin are mostly average folks, mostly advanced or above average technical people.  With a few exceptions like Mike Novogratz, few Wall St. types, few Elite aristocrats (if any).  Sound familiar?  Remember Fakebook in 2007, 2008 even before the massive control systems, the gamed news feeds, before things just ‘vanished’ like if you write something they didn’t like (disappearing sentences, accounts, etc.)  There was a time before Fakebook went ‘viral’ that it was ‘hip’ and only for ‘techies’ not the ‘main stream’ and then suddenly it ballooned. So there are some obvious technical differences here, just like there are differences between Fakebook and the Real Estate / Sub Prime pump and dump scam, and Bitcoin, and the scams before it.  Scam is a harsh word but the fraud is so elaborate and malicious that much more harsh words are called for.  Fakebook literally can be credited with destroying the social fabric of America.  Some would argue that’s a good thing – but it’s another topic. Bitcoin is a Crypto Currency but like any investment, it has a lot of features like social media.  The interesting link here is that Social Media made Bitcoin popular.  For years the price stagnated, and it didn’t get much attention.  Once the price started going up – then it went viral.  People love making money!  It was an alternative investment for the masses.  You could buy Bitcoin with as little fiat money as you had.  This, and the fact that it was digital, and global, gave it the mass appeal finally shooting the price to stratospheric levels. So hold on to your horses in case you don’t know this and you start screaming and spook them – As we explain in our book Splitting Bits – we believe based on available public evidence that the creator of Bitcoin was the NSA, either as a sub-unit or an individual working for the NSA.  We have no smoking gun evidence – but no one else does as far as any alternative creator.  Our scenario is simply the most plausible – it’s not necessarily the facts.  There is not 100% fact showing the real face of the creator of Bitcoin.  And the NSA will not confirm or deny it’s involvement, but it will provide a statement to an FOIA request that it will not confirm nor deny if such information would be or would not be classified (of course). But what’s interesting is that, the NSA is reportedly monitoring Bitcoin transactions under a program called MONEYROCKET: For instance, one memo from the NSA, the report cited, suggested the agency has collected private information such as bitcoin user passwords, internet activity and device identifiers.
According to the report, the NSA has been monitoring the internet activities of bitcoin users since 2013 through a program with codename as OAKSTAR. And yet the new leak suggested that with MONKEYROCKET, another sub-program under OAKSTAR, the NSA may be moving closer to pinpoint users who initiate a cryptocurrency transaction."SSG11 analysts have found value in the MONKEYROCKET access to help track down senders and receivers of bitcoin," one memo reads.
If these memos are real, and there is no reason to believe they are not, they are likely an indicator of what’s really going on, such a program would likely involve a team of people, millions of dollars, and hundreds or thousands of documents.  NSA didn’t setup MONKEYROCKET to track down a few money launderers.  It’s not their job, really..   Going back to the Facebook analogy, we have to consider 1) how Bitcoin goes up and 2) how Bitcoin is primarily a grassroots movement from the fringe.  Crypto is the next bubble, we can ride the bubble – but here we will make a bombastic claim: Bitcoin is the MySpace.  Bitcoin isn’t ‘the bubble’ actually Bitcoin is a poorly designed currency and remember that for Bitcoin there was no ICO.  This ICO terrible idea was popularized mostly by quasi criminals who were ineligible for registration.  We’re referring to financial criminals, the new mafia (they have evolved from the days of protection insurance, etc.), fraudsters, Ponzi scammers, and other similar elements the Crypto world has attracted. Bitcoin is the social media of finance.  But instead of sharing photos of old friends and breakfast choices, Bitcoin enabled a higher element of socialization, i.e. ‘hey I just made 10,000% return on my money, you might want to check this out.”  It’s like the .com boom on steroids, and it was global (Bitcoin isn’t a US product per se).  In order to ‘spend’ Bitcoin it was necessary for early adopters to engage in viral marketing to make Bitcoin viable.  The concept of fully electronic money is not new, but in 1989 David Chaum’s DigiCash failed, for a number of reasons but the most likely was the fact that the internet didn’t have the penetration in 1990 as it did in 2010.  Social Media and the internet was a conduit for Bitcoin. And Bitcoin quickly gave birth to Ethereum, and now there are more than 2,000 crypto currencies being built and developed on an exponential pace.  Ironically though, there is only one regulated futures contract at the CME, Bitcoin Futures, and only 1 regulated ICO – the tZERO ICO (*it is ‘registered’ not ‘regulated’ but the point here is that tZERO has followed SEC guidelines, and they are a regulated company – they aren’t based in BFE with a bunch of John Doe’s as their Advisors). Our point here is that Bitcoin did what it set out to do – start a race of development which is fueled by the mania created by the 1,000,000% BTC/USD chart.  Something like a million percent return never happened, and likely will never again.  The group that created Bitcoin whoever they are, know very well that the large banks control the system and there is no hope of creating a ‘parallel’ system without the blessing of Wall St. and DC, this was most notably proven with Chile’s Project Cybersyn:
Project Cybersyn was a Chilean project from 1971–1973 during the presidency of Salvador Allende aimed at constructing a distributed decision support system to aid in the management of the national economy. The project consisted of four modules: an economic simulator, custom software to check factory performance, an operations room, and a national network of telex machines that were linked to one mainframe computer.[2]
Project Cybersyn was based on viable system model theory and a neural network approach to organizational design, and featured innovative technology for its time: it included a network of telex machines (Cybernet) in state-run enterprises that would transmit and receive information with the government in Santiago. Information from the field would be fed into statistical modeling software (Cyberstride) that would monitor production indicators (such as raw material supplies or high rates of worker absenteeism) in real time, and alert the workers in the first case, and in abnormal situations also the central government, if those parameters fell outside acceptable ranges. The information would also be input into economic simulation software (CHECO, for CHilean ECOnomic simulator) that the government could use to forecast the possible outcome of economic decisions. Finally, a sophisticated operations room (Opsroom) would provide a space where managers could see relevant economic data, formulate responses to emergencies, and transmit advice and directives to enterprises and factories in alarm situations by using the telex network.
The project was so head of its time, what a desktop computer can calculate was 10x more powerful than warehouses full of computers in 1971.  But the idea had to be squashed and Allende was taken out and replaced with a US friendly regime.  The timing of this dismantling of the world’s first AI economic  management system, coinciding with Nixon’s creation of the floating FX regime, perhaps the opposite of intelligence, should be noted.   Analysis & Conclusion So here’s the deal with Bitcoin and Crypto.  The big wave, the paradigm shift – it’s going to be in the regulated coin space – the Dollar Cryptos, Fedcoin, Crypto Rubble, and Crypto securities.  When you can buy and sell Crypto on regulated exchanges – then you’re going to see a real paradigm shift.  And that’s coming – but slowly. 
Over the past year, Lund says he’s met with 20 central banks exploring the potential benefits of issuing their own fiat cryptocurrency on a blockchain. Specifically, he described the “most durable digital asset” as one that is “issued by a central bank that represents a claim on fiat deposits in the real world,” but still maintains “some semblance of monetary policy.” Though he wouldn’t reveal the names of most of the central banks with which he’s meeting, he described them as largely comprised of banks from the G20, an international forum with members including China, Russia, the U.S. and the EU. Lund further described the central banks as “clients in some capacity.” Based on these conversations, he said he expects the first central banks to issue a fiat currency on a blockchain will be “the smaller ones” with a high concentration of interest in Asia and North America.
Is Bitcoin going to 50,000? Probably not.  But Bitcoin’s rise to 20,000 surprised many, so it would not be surprising if it went to 100,000.  Just remember one thing – the only thing that makes Bitcoin go up is buying and no selling.  Selling pressure from Mt. Gox trustees put sell side pressure on Bitcoin as they unloaded Billions of USD worth of Coins on the market.  Bitcoin whales that control a huge chunk of available supply could sell.  The only thing that can make Bitcoin go up to 50,000 are billions in USD worth of buy orders.  There is a physical limit to the price of Bitcoin based on how much fiat currency there is in the world.  For example if every available US Dollar, Euro, and all other fiat currencies converted ALL of themselves to Bitcoin it would go very high, and we can calculate what that number might look like.  But it is a number it is not infinite.  The same can be said for stock, real estate, or other bubbles – this is bubble dynamics 101 something that the Bitcoin crowd mostly misses. Here’s the demotivational speech.  So we are claiming that Bitcoin is the MySpace and the “Facebook” of Bitcoin is still to be developed.  Just like in the pre-IPO space, investors are looking at in the best case 20x – 100x returns if they catch it.  Of course, it will not be easy to know WHICH of the 10,000 new coins is going to be the next Facebook.  But likely it will be one backed by Goldman Sachs, it will be made in Silicon Valley or in Berlin, and it will be regulated.  Regulated Crypto is the future.  10 years from now probably all assets will be Crypto assets – only because of the security and efficiency features.  The global FX markets for example, something Crypto stands to revolutionize, are really outdated, and didn’t really change their model since FX was created by Richard Nixon in 1971.  Even until 2007 banks engaged a majority of their volume on ‘voice orders’ !  The global financial system has been ripe for an upgrade, and what Bitcoin did it said this to the world.  It sent a message which was well received by Main St. investors, Wall St. financial engineers, and politicians alike. Now, they are pedal to the metal coding and designing around the clock.  The first coin in the class we are referring to here is Basis, backed by Wall St. and Silicon Valley and cooked up in a frat room at Princeton, perhaps the most Elite of the finance schools depending on who you are debating.
Investors apparently love what Basis  is cooking up. The upstart is announcing today that it has raised a somewhat stunning $133 million in funding from Bain Capital Ventures, GV, longtime hedge fund manager Stan Druckenmiller, one-time Federal Reserve governor Kevin Warsh, Lightspeed Venture Partners, Foundation Capital, Andreessen Horowitz,  WingVC, NFX Ventures, Valor Capital, Zhenfund, Ceyuan, Sky Capital, Digital Currency Group and others.
The coin idea here is a ‘Stable Coin’ – which isn’t a unique idea, it is more of a sub-movement in the Crypto community.  While Bitcoin got the world’s attention, it is a poor spending currency, certainly not a store of value, and the Blockchain technology behind Bitcoin is basic, although stable, does not represent the best of what Blockchain can do, as many other coin startups have pointed out. How this will save the financial system?  It is a transition to a new global financial regime.  Crypto Currency itself is not such an amazing development.  In Scandinavian countries they have been using digital electronic money for years.  What’s the difference really between Bitcoin in your wallet or your 100,000 USD at the bank?  The banking system has become bloated, inefficient, and in great need of reform. New markets will open up which are Crypto-denominated.  Trading strategies will evolve that were not before possible.  The establishment will not be destroyed, by design – Bitcoin requires vast amounts of electricity to be mined.  So unless the next ICO is going to raise $10 Billion to build ‘clean’ Thorium nuclear reactors, Bitcoin is not so different than the Petro Dollar as it must pay it’s utilities in USD from mining.  Of course that’s just one model as shown by Bitcoin – but there are others – countless others.  Bitcoin started a chain of events (pun intended) that will lead to the next ‘paradigm’ of currency.
Document Information This deep analysis report was commissioned by Bloc10 authored by Global Intel Hub. 4/29/2018 for the 'Blogosphere'
Bloc10 update Bloc10 released recently Total Cryptos Android App (Free) , the Desktop Website @ and soon will release an Apple App.  Coming soon: Machine Learning Engine to predict the price of Crypto Currencies (paid service) and Blockpad, the world’s first secure Notepad for Crypto investors, Blockchain developers, and intelligence operatives.  To stay tuned on further developments in the Crypto space plugin to Bloc10 @
Links: NSA MONKEYROCKET DOCUMENTS: Global Intel Hub Library  New New Thing Book
Posted: April 30, 2018, 1:23 am
Back in the summer of 2015, Deutsche Bank mistakenly paid $6 billion to a hedge fund client in a “fat finger” trade on its foreign exchange desk. The embarrassed bank recovered the money from the US hedge fund the next day, and quickly accused a junior member of the bank’s forex sales team of being responsible for the transfer while his boss was on holiday; as the bank further explained, instead of processing a net value, the person processed a gross figure: "That meant the trade had too many zeroes" a staffer helpfully explained.
Fast forward to today when Germany's largest bank has done it again.
According to Bloomberg, a routine payment at Deutsche Bank "went awry" (or as the article notes "was flubbed") last month when the bank with the €48 trillion in derivatives...
... mistakenly sent 28 billion euros ($35 billion) to an exchange as part of its daily derivatives margin transfers.
While the error was quickly spotted and no financial harm was suffered by the bank which has made clusterfucks into its business model, it represents a terrific case study why one should never confuse gross and net derivative exposure: as Bloomberg adds, the "errant" transfer occurred about a week before Easter as Deutsche Bank was conducting a daily collateral adjustment. The delighted - if only for a short time - recipient of the massive transfer was the Deutsche Boerse AG’s Eurex clearinghouse, in whose account the sum landed.
“This was an operational error in the movement of collateral between Deutsche Bank’s principal accounts and Deutsche Bank’s Eurex account,” Charlie Olivier, a spokesman for Deutsche Bank, wrote in an emailed statement. “The error was identified within a matter of minutes, and then rectified. We have rigorously reviewed the reasons why this error occurred and taken steps to prevent its recurrence.”
Of course, Deutsche Bank vowed the same "rigorous" review took place after the 2015 FX transfer fiasco and clearly nothing changed. Actually no, what changed is that Deutsche Bank has been a chronic underperformer, its stock crashed in 2016 to levels below the financial crisis amid speculation about its solvency, and just last week the bank's latest CEO was fired for what really amounted to incompetence.
Surely a pattern is emerging.
Indeed, as Bloomberg adds, "the episode raises fresh questions about the bank’s risk and control processes, at a time when lenders are faced with increased scrutiny from regulators. It’s another embarrassment for Deutsche Bank at a time when it is undergoing a change of leadership in the wake of its third straightannual loss."
And while the "glitch" took place during the last days of now ex-CEO John Cryan's tenure, it will surely be seen as another wrinkle for the bank's new chief executive Christian Sewing who even before this news already had a mountain to climb, as Deutsche Bank is the worst performing member of the Stoxx 600 banks index this year, with the shares having fallen 26% YTD.
Also, in light of the latest debacle, one wonders if the transfer had anything to do with the recent ouster of bank COO Kim Hammonds, who reportedly called Deutsche Bank "the most dysfunctional company" she’d ever worked for.
Finally, adding insult to injury, as we reported over the weekend Deutsche Bank was asked by the ECB to simulate a "crisis scenario" and an orderly wind-down of its trading book, making the German lender the first European bank to receive such a request from the ECB, which is reportedly using Europe’s largest investment bank as a "guinea pig" before it sends similar requests to other banks.
Then again, other European banks don't have €48.3 trillion in derivatives they would need to wind-down overnight.
Posted: April 19, 2018, 6:39 pm
From 4/14/2018
Syria has been bombed which calls for a deep analysis of what's going on here.  As we explain in our book Splitting Pennies - what really backs the US Dollar is BOMBS.  Wall Street and the MIC (Military Industrial Complex) are inextricably intertwined, whether you are an armchair intellectual or an investor it's important to understand this economic relationship.
The latest action in Syria is that policy in action.  Let's take a step back and understand this critical but boringly predictable development in Syria, the players involved, their respective relevant histories, and what markets can expect.
First let's look at War Inc. or the Military as a business, or as we have outlined in a detailed article "Cult of War" (a good primer read if you're not up on this topic).  With 800 Billion + per year and a likely real spend of well over a Trillion USD, the US taxpayer needs to get something for their money.   The Military is in a constant state of self-justification.  The US outspends the enemy by such a large figure, there are stockpiles of bombs, planes, tanks, guns, logistic supplies, boats, aircraft carriers, satellites, and just millions of expensive assets getting dusty.  The US could fight World War 2 on 2 fronts and a war in Space and still have assets left over.  There are hundreds of military bases, millions of personnel, it has become just a massive super entity above Presidents, above the Elite, above Governments.  By itself, as a form of Artificial Intelligence, the Military will do anything to prove the need it serves and survive.  The glaring problem - no enemies!  The number of real enemies is dwindling.  But Syria has been on the CIA's hit list for some time, controlling key Oil transport sites and other resources.  Not to mention Israel has wanted to destroy the unfriendly regime for a long time.  Cult of War needs to create conflicts of any size, it's a 'use it or lose it' mentality.  There's no better training drill than the real thing.
The False Flag
False Flag operations are when a government or other body will secretly stage an event to make it look like it was the enemy, thus providing justification for war.  False flag operations obviously need to be handled with laser like precision (ideally, but in reality such as in 911 they are botched).  One of the first significant False Flags in American modern history is the sinking of the Lusitania, staged apparently by warmonger Winston Churchill in an attempt to bring the ruffian Americans into World War I:
The Lusitania set sail for Liverpool on May 1st, 1915 from New York harbor. It was carrying millions of rounds of ammunition and shrapnel. The previous captain Daniel Dow had resigned because of mixing civilian passengers with munitions. The ship was to have a British battleship escort called the Juno but was recalled before the rendezvous in spite of the knowledge that a Uboat was active in the path of the Lusitania.
False Flag operations are nothing new, Hitler burned down the government building and claimed to be able to catch the terrorists and restore order in Germany, finally naming himself Chancellor.  Every powerful regime has a False Flag that they 'own' in order to justify their 10 year run in power.  Their time is limited, people forget, so a new event is necessary every few years, custom tailored to the situation.
This false flag was planned and executed by MI5 (British Intelligence), although the details of the operation are as yet unclear.  What is clear is that it is a Hollywood style staged event which was put together in the last minute with many mistakes and inconsistencies (they didn't have a script supervisor!) as pointed out by countless fact-based witnesses and other governments:

Speaking with EuroNews, Russia's ambassador to the EU, Vladimir Chizov, said "Russian military specialists have visited this region, walked on those streets, entered those houses, talked to local doctors and visited the only functioning hospital in Douma, including its basement where reportedly the mountains of corpses pile up. There was not a single corpse and even not a single person who came in for treatment after the attack.""But we've seen them on the video!" responds EuroNews correspondent Andrei Beketov."There was no chemical attack in Douma, pure and simple," responds Chizov. "We've seen another staged event. There are personnel, specifically trained - and you can guess by whom - amongst the so-called White Helmets, who were already caught in the act with staged videos."  "All these facts show... that no chemical weapons were used in the town of Douma, as it was claimed by the White Helmets."  “All the accusations brought by the White Helmets, as well as their photos… allegedly showing the victims of the chemical attack, are nothing more than a yet another piece of fake news and an attempt to disrupt the ceasefire,” said the Russian Reconciliation Center.
Of course, US warmongers will say that the Russians are protecting the Assad regime.  There's plenty of video and other evidence for internet sleuths to sort through in the coming days.  But we have seen this so many times before we can guess the outcome fairly easily.  It was a false flag, done by the British, in a sad and pathetic last attempt to save what remaining Elite aristocrats have over the masses, post Brexit.  Although actual war is unavoidable in Syria now, one possible outcome of this is a populist movement against such politics, as is happening in Hungary.
Support of the US Dollar
So what's the real reason the US chooses Syria to bomb and not Greenland for example?
1. The Petrodollar (via comment on The Gateway Pundit):
“The Chinese have recently issued the gold backed Yuan, which they, and others, have vowed to use to sell/purchase oil (amongst other things).  The last two nations that tried to introduce a currency to compete against the petrodollar were Libya and Iraq. The US needs that pipeline through Syria even more than ever now, especially if they are to compete for European gas/oil markets (presently controlled by Russia and their pipeline) and the Chinese Yuan.  But i’m sure none of that has anything to do with it…”
Syria is not only close to the Chinese they are also working closely with Russia.  All of this is a non-USD system they are building, not controlled by DC.  So of course, it has to be destroyed.  This is outlined in great detail in the book Splitting Pennies. 
It's not only about Syria itself, you see.  The GDP of Syria won't make a difference on the USD.  It's about stopping a revolution.  If Syria uses a Russian - Chinese financial and energy system perhaps it will spread to Jordan, Lebanon, and who next?  If half the world is suddenly using a Yuan denominated trading market, it would threaten US hegemony.  So all alternatives need to be stopped in their tracks, period.  That isn't an opinion it is the policy in DC based on research by companies like RAND.
Trump Politics
Trump seems to be a victim of the international cabal that was a step ahead of him the whole time.  In the opinion of this author, Trump is not a 'plant' from the beginning meant to deceive the voters.  The UK is the master planner of this operation, including but not limited to the false flag.  When domestic attempts by the deep state to derail Trump failed, they realized a coordinated effort from abroad was a better approach, one that Trump would be defenseless against, as his experience in international politics is zero (before getting into the White House).  Hence, Trump's involvement in this quagmire is meant to ensnare him in a series of decisions that will weaken his domestic position, alienate his base, while achieving goals of the War Party, Zionists, the Oil industry, and other interests in this confluence.  Trump was forced with a choice:  pick sides, choose the Russian facts (there was no chemical attack) or the British lies.  Being attacked by the domestic media by idiotic yet influential forces, staging a dangerous trade war, and coming to the conclusion of a Russian collusion investigation, backed Trump into a corner.  If he had chosen to side with Russia, it could have backfired and blown up in his face.  Democrats, Leftists, and other Trump enemies would have pounced on the issue accusing him of being Putin's lap boy all along.  Being that this is Trump's first rodeo, he doesn't have the complex knowledge base or pool of advisers to deal with this strongly and independently.  In fact he hasn't been able to build a strong team of advisers independent of deep state snakes working against him.  This is not his fault, it is just the reality of how intertwined everything is in DC.  "Drain the Swamp" is a great marketing slogan, and a noble idea - but implementing it may prove impossible.  And on the surface, everyone loves the hero story - an evil monster gassed innocent people, and we are 'saving' them.  This is a great excuse to spend billions on bombs we don't need and use them.  He bought the party line of the MIC "We have to bomb the village to save it":
“The United States will be a partner and a friend, but the fate of the region lies in the hands of its own people.”
“Tonight, I ask all Americans to say a prayer for our noble warriors and our allies as they carry out their missions. We pray that God will bring comfort to those suffering in Syria.”
God will bring comfort to those we are bombing?  Really?  Can he be any more offensive?
This is the beginning of a series of events that Trump cannot dig himself out of.  The MIC won't stop until the majority of Syria is destroyed and key resources are controlled by US forces.  Some of us remember in the 90s there was 'chatter' that the NeoCons were planning a false flag in a major US City that was 'nuclear' - whether that was 911 or an event that never happened we'll never know.  But one thing is clear - they have the weapons, so they will kill all that stand in their way.  Whether he is one of theirs or is being manipulated by them is irrelevant for his base which was largely anti-establishment and anti-war, anti-globalist, which he has proven to be the opposite.
World War 3 
With the ascent of Russia, China, and smaller states building their armed forces without reason, it is only inevitable that they are used.  War between China, Russia, the US and allies is inevitable.  But wait - it's not what you are thinking!  There will not likely be strikes on US, Chinese, or Russian soil.  Rather, as in the Hunger Games, war games will be played in theaters such as the South China Sea, Syria, and other hotspots.
World War 3 will likely last 50 - 100 years, like the cold war, it will be an going unresolved war in places like Syria.  Flare ups and skirmishes will be the extent of the action.  Nukes may be used but tactical nukes in a limited, regional capacity.  PROBABLY.  Of course, it could completely spiral out of control.  But deep analysis indicates not.  There needs to be just enough war to justify the military and not enough to destroy it.  In the same way the MIC needs a war to justify its own existence, a complete obliteration of a major player would also be an endgame (including but not limited to a humanitarian outcry if a major city was destroyed in one bombing such as London or Berlin.)
Remember folks there was only one country that has used nuclear bombs to kill millions and that country is the United States of America.
The War Inc. model - 2 new players
China and Russia are both copying the War Inc. model from the United States.  Both countries do not have any real threats (except from the United States, but as a game) with the exception of terrorism.  Japan has no army and is not a threat to China.  China has destroyed all the regional competitors and has no real major state enemy.  Domestic politics may be a bigger threat to China than any foreign military (as China was once a chaotic, multi-state region).  China is a little bit like the Soviet Union, but through the prism of their culture of course.  The point is multi-ethnic super states usually collapse given enough time, as there are competing domestic interests at play.  That is China's focus not to be a military power, their external show of force is to play the American game.  America needs an enemy.  The China 'copy and paste' model, a threat to the IP of US tech companies, is also at play with War Inc.
Russia MIC
Russia is an interesting case here.  During the Soviet Union Russia was a defense oriented country that did little in foreign countries outside of the Iron Curtain.  After decades of high quality propaganda, at a cost of tens of billions of dollars, Russia realized that if they wanted to be a major player in the world and participate in the new growing economic power center they needed to switch to Capitalism, which they did in 1991.  This was a hard shift, it is difficult for those outside Communist countries to understand what it means to 'switch' from a state controlled economy to 'free market' economy.  Russia's markets were so free in the 90s it led to massive growth by organized crime which was borderline legit business (they were like the Robber Baron's of the industrial age in USA).  Basically Russia is 80 years behind the US, socially.  Since 1991 Russia has taken all the advice given to them by their Western economic advisers.  They have implemented a stock market, there are entrepreneurs in Russia starting businesses on a daily basis, they even have a Silicon Valley style incubator in Moscow Skolkovo (and others - see more info on starting a venture in Russia here).  Russia has implemented many reforms in their plan to make Russia a market leader.  They have a long way to go, their manufacturing standards have become a joke when Putin opened the door of a Russian car and the handle came off.  But the world seems to forget that this was the 'Communist' country that the West sold on a better, capitalist life.  One of the trimmings of a Capitalist society is War Inc.  The partnership between Syria and Russia is a natural one; there are critical oil pipeline routes in Syria and Syria is a Christian foothold in a predominantly Muslim region.  Russia didn't invent the War Inc. model however it is now operating it based on a business plan that was sent to them by Washington during the Cold War.   It should come as no surprise that they are doing what they were convinced to do by Capitalist Generals in Washington.  Billions upon billions were spent on Hollywood produced propaganda programs including films, radio (Air America), Television programs, news, and later internet campaigns.  They are influenced by reports such as "What the bombing of Syria means for your 401k" and other reports.  Russia is playing the role of War Inc. - a model copied directly from US interventions in Iraq and other places (Iraq is most similar).  There is no real skin in the game for either country, Syria is just a proxy state to be used and abused for the war profiteers.  This is the first time Russia is playing this role and it is playing it well.  It wouldn't be surprising if Russian and US generals were exchanging encrypted communications on their competing computer game theory simulations while contemplating their next moves with each others open feedback.
Vacuum dirt analogy
Why are vacuum cleaning manufacturers honest and politicians are not?  Because when you buy a vacuum, you immediately see how it works (the dirt and particles are caught in the transparent tank).  If a vacuum didn't work or had poor suction it would be immediately apparent and people would return them or complain.  Politicians control the information flow, especially during war, because they have power.  This is especially true of government employees who are publicly elected.  In private business there is a lot of oversight and ultimately you will fail or succeed, you can't lie to investors quarter after quarter.
Armchair Intellectuals and the Great American Hobby
Finally, there is this class in America not sure how to describe them, perhaps "Saturday Night War Experts" - they support any show of US force.  They are mostly middle aged males with health issues, mostly on multiple prescriptions, they enjoy watching infographics explaining the differences between cruise missiles and smart bombs, right after their 5th glass of Merlot.  This class isn't completely handicapped, but they choose to spend their free time sitting in Lazyboy chairs watching Fox News and other sources during wartime.  When they're not tuned in, they enjoy to debate with their friends different methods how the US could use its arsenal to completely destroy Syria or "Make it GLASS" as I'm sure all readers have heard someone say once.  This grotesque hobby is what gives those in DC power to enact such measures.  You don't read headlines that Norway has unilaterally destroyed Sweden.  In New Zealand for example there is a ban on Nuclear anything.
The info trade
During the last Iraq was there was an interesting correlation between US strikes, war actions and info, and the US Dollar.  It was caused by speculators not real money flows.  War is information and the markets live on information.  All markets will be impacted by this war, it can even be a trading strategy by itself.  Defense stocks will have a boost on successful missions.  Key victories will lead to USD being bid up.  It's a busy time and there's a lot happening.  War traders must be tuned in 24/7 as the smallest bit of info that hasn't hit the wires yet can cause markets to move.  Traders need to become information junkies.
Don't skip over the obvious facts that are staring us in the face.  This is the beginning of World War 3 - but don't worry - it's good for the economy.  Game on!
To read about the inner workings of this system checkout Splitting Pennies.  Support great journalism and shop at and invest at  You read this quality analysis free - please share this article especially to friends with a TV!
Reference articles
Posted: April 15, 2018, 3:18 pm
The SEC's highest-ranking official appears to be softening his sentiment toward ICOs.
At a Princeton University event Thursday, SEC chairman Jay Clayton went so far as to reject the idea that all ICOs are fraudulent, answering "absolutely not" to a question centered on whether his agency's actions against the founders of blockchain projects amounts to such an admission.
Clayton's remark came during a talk on "Cryptocurrency and Initial Coin Offerings," one that was notable given his past statements, including his most famous issued in February, in which he said that he believes "every ICO" he's seen qualifies as a security. Indeed, Clayton opened the talk by telling the assembled students he believes that "distributed ledger technology has incredible promise for the financial industry."
The SEC chairman went on to argue that the steps taken by the agency in recent months could actually help the industry mature overall.
He told attendees:
"Is the approach taken in Washington by the SEC adversely affecting distributed ledger technology in other areas? My quick answer is that my hope is that it's actually helping - because this technology is being used for fraud and to the extent that it's being used for fraud, history shows that government comes down harshly on that technology later."
Clayton continued: "I think if we don't stop the fraudsters, there is a serious risk that the regulatory pendulum - the regulatory actions will be so severe that they will restrict the capacity of this new security."

Utility token debate

Elsewhere, Clayton discussed the evolving terminology of the industry.
One of the issues with token sales, he remarked, is the attempt to classify them as so-called "utility tokens," which would ostensibly free them from any kind of designation as a security. As such, he reiterated his view that almost all token sales purport to sell such products, despite the fact that they are actually securities.
If a startup is "offering something that depends on the efforts of others, it should be regulated as a security," he told the gathering of students on Thursday.
Clayton used an analogy to describe the difference between a utility token and a security token.
"If I have a laundry token for washing my clothes, that's not a security. But if I have a set of 10 laundry tokens and the laundromats are to be developed and those are offered to me as something I can use for the future and I'm buying them because I can sell them to next year's incoming class, that's a security," he explained.
Still, he suggested that such a definition can evolve over time.
"What we find in the regulatory world [is that] the use of a laundry token evolves over time," he continued. "The use can evolve toward or away from a security."
Further, nations may experiment with sovereign cryptocurrencies, while startups might develop different kinds applications with the underlying technology, he added.
Whether a token qualifies as a security could also change as the industry evolves, he said, adding:
"Just because it's a security today doesn't mean it'll be a security tomorrow, and vice-versa."
Jay Clayton photo by Mahishan Gnanaseharan for CoinDesk
Posted: April 6, 2018, 7:14 pm
Bitcoin in USD is down to 7,000 which is really a huge number when you think about it, but HODLrs who got in at more than 10,000 are feeling the pain, those who got in with leverage above that are freaking out, many wiped out.  And the thing about Bitcoin although there are hundreds of better alternatives, Bitcoin remains 40%+ of the market cap of the entire crypto currency universe.  As we explained in our groundbreaking book on this topic Splitting Bitsand on Zero Hedge in an exclusive article, we believe the only possible creator of Bitcoin is the US Government itself, specifically the NSA.  Because of the size of the Bitcoin market now, and the new paradigm created, the creator of Bitcoin is relevant.  People are borrowing against their 401k to invest in Bitcoin or start their own crypto, and we don't even know the identity of the creator of this phenomenon?  We know, it's the NSA - but the NSA is an organization.  Saying it's the NSA is a bit like saying it was the CIA that killed JFK.  Well the CIA certainly couldn't possibly kill anyone because it's an entity, people use guns and guns kill people, not entities.  It would be interesting indeed to unmask the real creators of Bitcoin, if they haven't been retired or disappeared on their GS-15 package.  Perhaps they are living it up with the witsec family, or have changed their face and are pursuing their hobbies whatever they may be.  Whoever it is, it is likely a dead a buried secret.  Who knows how the market would react if the real creator came forward and ultimately liquidated the millions of bitcoin on the market.  (For those of you who don't know, there are 42,000 zombie addresses of Bitcoin meaning they are not used but storing Bitcoin which can be seen publicly on the network, see here.)  Wait a minute - 42 is the meaning to life, according to an AI computer that was built to answer the age old question 'What is the meaning of life?' 
Could it be that what Adams really means is that 42,000 Bitcoin is the meaning of life?  Now we're getting somewhere.  42 Million is the meaning of life.  Where are all the numerology nutjobs when you need them?  3/30/2018 / 42 = 78,619.
Bitcoin is genius, perhaps the most intelligent creation of the digital age.  It served several purposes:  it's a perfect marketing engine (it allowed small investors to potentially earn a big return, the only asset to do so although many have claimed this), it created a new paradigm of digital currency, it changed the way the entire world looks at banking and trading, it has caused the entire tech sector to reshift it's business, all at a cost of likely a few million dollars.  If you follow the thinking that Bitcoin was in fact a child of an NSA lab, you have to continue the thought that the US Government and more specifically the military is the first real form of Artificial Intelligence.  Billions of dollars are invested every year and we all complain about waste, and there is waste - but there is also Bitcoin.  And unlike many successes of the intelligence apparatus, they will never be acknowledged, there will never be a statue in DC with the creator, never a parade.. But such is the life of a spook.  They signed up for it.  But the monetary rewards and the real intellectual pleasure of watching this game play out are so rewarding well it cannot be bought with money.  Some things in government service are priceless, this is one - thank you Mr. Mathematician!  You are the real hero, and heroes (likely it was a team effort).  There are some names on their 1996 paper but anything that is visible electronically in reference to the NSA can be assumed to be inaccurate, misleading, an intentional disinformation, or in any case a dead lead.  But it's worth having a look - click here to read it.
Certainly no one is going to find out anything by searching Google!
So more to the point, Bitcoin going lower before it goes higher, if it ever does.  Real price of BTC/USD could be $100 or $200 - maybe $500.  In a market where money is chasing any higher returns than offered by the traditional markets - bubble psychology took off and fueled a historical hockey stick that will never repeat in crypto.  It can only repeat in some other format - like Quantum computing or if Elon Musk finds Helium 3 on the moon for example.  Something really value-shifting.  Aliens admit that 90% of valley technology came from them.  Bitcoin isn't going to $1 Million, at least it's not likely, but then again we have been shocked by the race to $10,000 and $20,000.  Remember investors that the only thing that drives the price of any asset higher is buyers.  The buyers have stalled and there have been waves of big sellers.  Bitcoin isn't going to be used as a replacement of the US Dollar any time soon.  It may be the dream of some Elite Globalists as a one world currency but it's not happening.  Bitcoin is flawed, slow, and only secure if you use it properly which no one does of course except maybe a few hackers.
Other new Cryptos which are designed better, have more appropriate designs which can empower their niche to flourish have much better chances for long term survival.  But as many know, this is nothing new or innovative, in the United States during the Wildcat currency period there were thousands of active currencies in the United States.  
Bear in mind the real value of Bitcoin is only what investors decide, just as they decided to drive it higher they can drive it to zero.  There is no intrinsic value in Bitcoin itself, as Roubini candidly pointed out recently.  
Posted: March 31, 2018, 1:54 am
The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.
—Ernest Hemingway
Military spending is the second largest item in the US federal budget after Social Security. It has a habit of increasing significantly each year, and the proposed 2019 defense budget is $886 billion (roughly double what it was in 2003).

US military spending exceeds the total of the next ten largest countries combined. Although the US government acknowledges 682 military bases in 63 countries, that number may be over 1,000 (if all military installations are included), in 156 countries. Total military personnel is estimated at over 1.4 million.
The reader could be forgiven if he felt that a US military base was rather unnecessary in, say, Djibouti or the Bahamas, yet the US Congress will not allow the closure of any military bases. (The Bi-partisan Budget Act of 2013 blocked future military base closings under the argument that they’re all essential for “national security.”) And Congress has a vested interest in keeping all bases open and consuming as much in tax dollars as possible (more on that later).
Of course, those bases need to be kept well-stocked with small arms, tanks, missiles and aircraft. Yet, in spite of the admittedly incredible number of US military bases across the globe, the additional stockpile of weaponry is so great that the government has difficulty finding places to put it all.
One storage location is pictured in the photo above - Davis-Monthan Air Force Base in Tucson, Arizona. In spite of the size of the photo, it shows only a portion of the aircraft located there. (And bear in mind, such aircraft often cost over $100 million each.)
If asked, the military states that, although these aircraft are in dead storage and many have never seen any use whatever, they might possibly be called up for service, “if needed.” Of course, if they’re needed, they’re unlikely to be of use if located in Arizona. And, in addition, they may not be useful for warfare, as war technology has moved on since the days when such aircraft designs were suitable.
It’s been said that generals are forever fighting the last war, and this is certainly true. Even a layman can observe that such conventional aircraft will never see use, as they serve no purpose in modern warfare.
And yet, these storehouses are being dramatically added to every year.
This year, production will be increased for the F-35 and F/A-18 aircraft. To get an idea of the cost of such expansion programmes, the F-35 Joint Strike aircraft alone will cost $400 billion for 2,457 planes. However, most of this cost will be for development and testing, not the planes themselves.
To save you the arithmetic, that’s about $162 million per plane. (I’m guessing that Henry Ford might have been able to produce them a bit more cheaply. It’s difficult to imagine what they could possibly be made out of to justify their extraordinary price tag.)
But, even though a staggering amount of money is spent on such aircraft, only to then send them to storage facilities at some point, why not, at the very least, sell off the surplus cheaply or scrap them and close down the costly bases that warehouse them?
Well there’s a bit of a snag there. If they were to be scrapped, it would be necessary to admit that they weren’t really necessary. And if they weren’t necessary, why were they purchased?
It may well be that the answer lies in the fact that the military industrial complex is a major political contributor, paying heavily into the campaign funds of both political parties.
It’s probably safe to say that, in doing so, they’re likely to expect something in return, and of course, that’s just what they get. As stated above, the “defense” budget is far beyond what it would cost to defend the US, and ridiculously so.
However, as far as the military industrial complex is concerned, the ideal situation might be for the US to enter into a policy of perpetual warfare with vaguely-stated military goals, and to do so on many fronts globally. If Congress were to approve a budget that would allow for that, the amount of kickback to the military industrial complex would not only be maximized, but it would be ongoing, from one year to the next.
So, is that what has occurred?
Well, if we look back at say, World War II, the most costly war in history, we see a war that was fought on three continents and cost the lives of between fifty and eighty million people, yet it was concluded a mere four years after the US joined.
By comparison, the undeclared war with Afghanistan has been a minor one, costing roughly 150,000 lives. Again, based upon arithmetic, as compared to World War II, it should theoretically have taken just over two months to conclude, yet to date, it’s been ongoing for seventeen years, and its daily cost has far exceeded that of a world war.
So, are we to conclude that the US military has become so inept that it can’t fight a war and win, no matter how much firepower they have and no matter how much time it takes?
If this is not the case, then there’s only one other conclusion to draw. (As Sherlock Holmes often said, “Once you eliminate the impossible, whatever remains, no matter how improbable, must be the truth.”)
In this case, what remains is that winning the war is not the objective and, in fact, never was the objective. The objective would be to consciously create perpetual warfare; to extract billions in tax dollars each year from the electorate, in order to pass the revenue on to the military industrial complex in the form of armaments contracts. Whether those armaments are needed, or even useful, would be of minimal importance.
In recent years, the US military has gone far beyond its original concept of “defense.” It’s invaded more countries than ever before in its history, often with no direct provocation whatever, on the basis of “making the world safe for democracy.” (It should be borne in mind that invading a country, largely destroying it, then installing a puppet government is not exactly “democracy.”) In addition, these have not been actual “wars,” as, under US law, only Congress can declare war and has not done so since 1942.
In addition, the “enemy” in each case has been vague indeed. The US is not at war with any country specifically, but with “terrorism,” a non-specific enemy, one that’s even more vague than George Orwell described when writing 1984.
If nothing succeeds like success, it’s also true that nothing exceeds like excess. If this thought is troubling now, it will be even more troubling when the US makes good on its threat to attack North Korea, a small country next door to China, or to invade Iran, an ally of both China and Russia.
When the fur really starts to fly, it will be highly doubtful if the American taxpayer is able to pony up the further cost of a true world war, which would be far beyond what they’re shouldering at present.
And, since the loser in a war is almost always the country that runs out of money first, and the US is for all purposes broke, the outcome of such a war would not be in favour of the US.
*  * *
You don’t have to sink with the US… There are practical steps you should take to prepare—before America makes a dangerous military move. Get the details straight from Jeff in our guide to Surviving and Thriving During an Economic Collapse.
Posted: March 27, 2018, 2:21 am

The world is a wild place.  Why go into a store and subject yourself to a number of risks and dangers, including but not limited to catching a cold – when you can do all your shopping from the comfort of your own home!  Things like Amazon Prime now make online shopping very easy.  Even without prime, you can get free shipping with a minimum cart size (usually $45).  Amazingly, they’ll ship anything from toilet paper to batteries.  There’s another consideration; price.  It’s possible online to quickly price check, and sometimes even exploit coupons, discounts, and other offers easier.

Posted: March 27, 2018, 2:06 am
By the authority vested in me as President by the Constitution and the laws of the United States of America, including the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.), and section 301 of title 3, United States Code,
I, DONALD J. TRUMP, President of the United States of America, in order to take additional steps with respect to the national emergency declared in Executive Order 13692 of March 8, 2015, and relied upon for additional steps taken in Executive Order 13808 of August 24, 2017, and in light of recent actions taken by the Maduro regime to attempt to circumvent U.S. sanctions by issuing a digital currency in a process that Venezuela’s democratically elected National Assembly has denounced as unlawful, hereby order as follows:
Section 1.  (a)  All transactions related to, provision of financing for, and other dealings in, by a United States person or within the United States, any digital currency, digital coin, or digital token, that was issued by, for, or on behalf of the Government of Venezuela on or after January 9, 2018, are prohibited as of the effective date of this order.
(b)  The prohibitions in subsection (a) of this section apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or any license or permit granted before the effective date of this order.
Sec. 2.  (a)  Any transaction that evades or avoids, has the purpose of evading or avoiding, causes a violation of, or attempts to violate any of the prohibitions set forth in this order is prohibited.
(b)  Any conspiracy formed to violate any of the prohibitions set forth in this order is prohibited.
Sec. 3.  For the purposes of this order:
(a)  the term “person” means an individual or entity;
(b)  the term “entity” means a partnership, association, trust, joint venture, corporation, group, subgroup, or other organization;
(c)  the term “United States person” means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches of such entities), or any person within the United States; and
(d)  the term “Government of Venezuela” means the Government of Venezuela, any political subdivision, agency, or instrumentality thereof, including the Central Bank of Venezuela and Petroleos de Venezuela, S.A. (PdVSA), and any person owned or controlled by, or acting for or on behalf of, the Government of Venezuela.
Sec. 4.  The Secretary of the Treasury, in consultation with the Secretary of State, is hereby authorized to take such actions, including promulgating rules and regulations, and to employ all powers granted to the President by IEEPA as may be necessary to implement this order.  The Secretary of the Treasury may, consistent with applicable law, redelegate any of these functions to other officers and executive departments and agencies of the United States Government.  All agencies of the United States Government shall take all appropriate measures within their authority to carry out the provisions of this order.
Sec. 5.  For those persons whose property and interests in property are affected by this order who might have a constitutional presence in the United States, I find that because of the ability to transfer funds or other assets instantaneously, prior notice to such persons of measures taken pursuant to this order would render those measures ineffectual.  I therefore determine that for these measures to be effective in addressing the national emergency declared in Executive Order 13692, there need be no prior notice given for implementation of this order.
Sec. 6.  This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
Sec. 7.  This order is effective at 12:15 p.m. eastern daylight time on March 19, 2018.
This should come as no surprise, however we should understand the higher play here.  As we explain in Splitting Pennies - the US Dollar is backed by bombs.  There is an underlying subtle threat - use US Dollars and drink Coca Cola or we'll bomb you.  It is good for business.
Let's just take a step back one generation, does anyone remember this news?
A bizarre political statement by Saddam Hussein has earned Iraq a windfall of hundreds of million of euros. In October 2000 Iraq insisted on dumping the US dollar - 'the currency of the enemy' - for the more multilateral euro.
The changeover was announced on almost exactly the same day that the euro reached its lowest ebb, buying just $0.82, and the G7 Finance Ministers were forced to bail out the currency. On Friday the euro had reached $1.08, up 30 per cent from that time.
Almost all of Iraq's oil exports under the United Nations oil-for-food programme have been paid in euros since 2001. Around 26 billion euros (£17.4bn) has been paid for 3.3 billion barrels of oil into an escrow account in New York.
The Iraqi account, held at BNP Paribas, has also been earning a higher rate of interest in euros than it would have in dollars.
At the time of the change the UN issued a report saying that the move could cost Iraq up to £270 million. Independent experts questioned the value of buying into a plummeting currency.
'It was seen as economically bad because the entire global oil trade is conducted in dollars,' says Fadhil Chalabi, executive director of the Centre for Global Energy Studies.
It seems that anyone who attempts to thwart US Dollar hegemony ends up getting bombed.  It may be all a coincidence, we will see shortly.  The big question is - 
The country is in a de-facto state of war anyway, with rampant inflation, pirates and robbers controlling the streets, and an underground Crypto mining industry that's keeping some away from starvation, on the down low:

There are stories of the government confiscating computers and mining equipment from people. Tell us about this.

Yes, sometimes the police squad that visits your place decides to seize your mining equipment, and there is absolutely nothing you can do about it.

What do they do with the equipment?

Rumor has it they install them on government facilities.
So the Venezuelan government, in its desperate need to generate funds in a chaotic environment with a worthless domestic currency, has launched the boldest Cryptocurrency project to date, a government & commodity backed Crypto.
While the politics are hardly comparable, the US narrative is fairly consistent since the success of operation PBFORTUNE in 1954.
Operation PBFORTUNE, also known as Operation FORTUNE, was the name of a covert United States operation to overthrow the democratically elected Guatemalan President Jacobo Árbenz in 1952. The operation was authorized by US President Harry Truman and planned by the Central Intelligence Agency. The United Fruit Company had lobbied intensively for the overthrow because landmark land reform enacted by Árbenz threatened its economic interests. The coup attempt was also motivated by US fears that the government of Árbenz was being influenced by communists. It involved providing weapons to the exiled Guatemalan military officer Carlos Castillo Armas, who was to lead an invasion from Nicaragua. The coup was planned with the knowledge and support of Anastasio Somoza GarcíaRafael Leonidas Trujillo and Marcos Pérez Jiménez, the US-backed right-wing dictators of Nicaragua, Dominican Republic and Venezuela respectively, as well as the United Fruit Company. However, the US State Department discovered that details of the plan had become too widely known.[1] US Secretary of State Dean Acheson was worried that the coup attempt would damage the image of the US, which had committed to a policy of non-intervention, and so terminated the operation.[2] Operation PBFORTUNE was a precursor to Operation PBSUCCESS, the covert operation that toppled Árbenz and ended the Guatemalan Revolution in 1954.[3]
For those of you who are just joining us, the US has led a global Empire since World War 2 and been the exclusive power in the world economically and militarily (although, when you dig deeper, the US is just a tool the real owners are mostly non-US).
If we are looking at things statically, today's EO fits the same pattern as a number of others pre-invasion.  With Russia being completely and 100% cleared of any wrongdoing, hacking, meddling, and social media botting - US war mongers are desperate to find a new enemy.  Venezuela fits the bill as South America has been the local playground for spycraft since the creation of the CIA.
We shall see in the days ahead.  Sunken boats, terrorism, strange things in Miami - who knows.  Maybe this time it will be something digital.  Venezuela will be blamed for 'hacking' into something, or a building in Miami will collapse.  Lots of rich Venezuelan consultants ready to help their hosts to go down and reclaim what was taken from them by the communists.
"We have been shamelessly threatened by the most criminal empire that ever existed and we have the obligation to prepare ourselves to guarantee peace," said Maduro, who wore a green uniform and a military hat as he spoke with his army top brass during a military exercise involving tanks and missiles. "We need to have rifles, missiles and well-oiled tanks at the defend every inch of the territory if needs be," he added. 
This is part 1 of a series IS VENEZUELA NEXT?
Posted: March 19, 2018, 10:34 pm
Like many traders, I read Market Wizards as a kid. If you don’t know it, it’s a collection of interviews with the most legendary traders of the 1980s.

Market Wizards

Back when I first read it, I really had no idea what the hell I was doing. I read it, thought I got it and moved on.
But I didn’t get it.
The reason was simple. I didn’t have the life experience and wisdom to understand it. That would take many, many more years.
A few months ago I picked up my old, dog eared and highlighted copy and started thumbing through it. I expected to snag a few quotes and move on but pretty soon I found myself hooked, reading it cover to cover all over again.
Two things struck me immediately.
  • First, I’d highlighted all the wrong things.
  • Second, I saw instantly how much these men were alike.
No matter where they came from or how they got started, they all remembered one devastating loss early in their career. They all started with little to no idea what they were doing. All of them transcended false beliefs and developed an amazing ability to adapt and change their minds in a flash.
Their styles, politics and temperament all varied widely but the rest of their lives followed a remarkably similar path.
That’s when I realized I was seeing something bigger, a meta-pattern, a pattern of patterns.
Call it the journey of the great trader.
So what is that path and how can you follow it?
Let’s take a close look.

Number One: Start Out Clueless

No matter how good anyone gets at something they always start out clueless. Maybe trading is some innate gift but that doesn’t matter at all at first. Everyone starts at step one.
Nobody starts off a superstar.
Maybe it’s my fault

This Wizards excerpt from Michael Marcus is typical of most traders.
“Q: Did you know anything at all about what you were doing? Had you read anything about commodities or trading?
A: No, nothing.
Q: Did you even know the contract sizes?
A: No, we didn’t.
Q: Did you know how much it was costing you per tick?
A: Yes.
Q: Apparently, that was about the only thing you knew.
A: Right. Our next trade, in wheat, didn’t work either. After that, we went back to corn and that trade worked out better; it took us three days to lose our money. We were measuring success by the number of days it took us to lose.”

You see the same story again and again. Somebody hears about how they can get rich quick in the market. Their friend tells them or they read a story about some king of Wall Street or the newly crowned crypto rich and they leap in hoping to make a quick buck, their eyes filled with stars.
Even if they do have some idea about the basic rules, like setting good stops and choosing a position size that won’t wipe them out they almost always ignore it.
Paul Tudor Jones, a super aggressive, hard charging trader, tells the tale of a horrible early trade where he made a spur of the moment “macho man” cotton buy leaving him seriously vulnerable. Immediately the other pit traders knew his mistake and he did too. The big whale of the cotton market started dumping on him almost instantly, driving the price down hard and locking him in.
He learned the hard way “Never play macho man with the market” as he wiped out 70% of his equity in a single trade.
Every single person thinks they’re smarter than the market. Even if they read the time honored rules of the best of the best they’re thinking “those don’t apply to me, I’m different.”
And that takes us to step two.

Number Two: Make the Same Mistakes as Everyone Else

Think you’re immune to making the same mistakes everyone else does?
You’re not. But don’t worry, you’re in good company.

Nobody is immune.
Inevitably new traders don’t understand why the rules are there to protect them even if they know the rules. Maybe after their clueless stage they read a few books or listen to some smart sounding traders on Twitter or take a course.
The problem is they don’t really understand what they’re reading and hearing. They can’t process it yet because they don’t have the experience to see the wisdom in it, even if they understand it partially at the intellectual level. Knowledge can’t be passed on passively. It has to be earned through personal experience.
And when you don’t understand the rules, what happens?
You screw up.
And what are some of those rules?
1) Don’t overtrade.
2) Keep your position sizes small.
3) Set stop losses.
4) Don’t make snap decisions.
5) Don’t get too high or too low emotionally.
Those are just a few of the essential pearls of wisdom that every trader eventually figures out.
The hard way.
In the beginning everyone just glosses over them.
Legendary currency trader Bruce Kovner tells a classic story about snap decisions. Kovner made his original money hedging spreads on contracts. He’d be long one contract and short another to reduce the risk but as soybeans rocketed to new highs in the 1970’s his broker got caught up in the euphoria and called him wild with greed:
“Soybeans are going to the moon…You are a fool to stay short the November contracts. Let me lift your November shorts for you, and when the market goes limit-up for the next few days, you will make more money.”
He agreed. Limit-up is a circuit breaker on the markets. If they went too high or too low the contracts locked and nobody could trade them. You were stuck. Limit-up meant you were making the absolute most money possible. Limit-down? You were losing the most money possible and even worse you were stuck and you couldn’t sell out.
Kovner perfectly describes the crazy euphoria every early market apprentice feels:
“It was a moment of insanity. Fifteen minutes later, my broker calls me back, and he sounds frantic.
‘I don’t know how to tell you this, but the market is limit-down! I don’t know if I can get you out.’ I went into shock. I yelled at him to get me out.”
By sheer luck he managed to get out when the markets ticked up past limit-down for a few minutes but not before eating a massive loss.
Afterwards, Kovner talks about the sickness every trader feels when they make a horrific trade and the market eats them alive.
“I was up about $45,000. By the end of the day, I had $22,000 in my account.”
And that brings us to our very next step on the journey of trader enlightenment.

Number Three: Take a Big Loss

Every single trader will eventually experience a catastrophic, heart breaking loss. Many of the best traders went completely belly up, more than once. The original great speculator, Jesse Livermore, lost multiple fortunes.

Kovner tells us the gut wrenching sickness of losing big money in the market.
“I went into emotional shock. I could not believe how stupid I had been — how badly I had failed to understand the market, in spite of having studied the markets for years. I was sick to my stomach, and I didn’t eat for days. I thought that I had blown my career as a trader.”
Michael Marcus tells a similar story of a disastrous sugar trade.
“Q: How much did you lose on the trade by the time you liquidated?
A: I lost my own $30,000, plus $12,000 of the $20,000 my mother had lent me. That was my lesson in betting my whole wad.”
Every trader has a story like that to tell. For me it was NEO. I got in late in the bull run and bet big. I just knew it was going to the moon and a few days later I was riding high and I nearly doubled my money.
China started threatening the big exchanges. It seemed every single weekend there was a brand new story attacking crypto, a big banker saying it was worthless or insane, China cracking down, or another country looking to ban trading.
It didn’t take long for the markets to panic.
And there was no worse coin to hold at the time than a Chinese coin. That’s exactly what NEO was, red Chinese through and through.
I watched my wins vaporize over the course of two days and I just froze. I panicked. I liked the coin and the project, I thought it would turn around so I just hung on as it went down and down and down.
In the end I lost 68% of what I put in.
I was sick to death. I couldn’t sleep or eat for days. Working out didn’t help. Getting a massage didn’t help. Alcohol didn’t help. Whacking it didn’t help. Nothing helped.
Only one thing could fix it. The next step.

Step Four: Reflect and Come Back Stronger

Once you finally experience that soul crushing loss it’s not long after that you realize it was the absolute best experience of your trading life.

If you’re smart and you’re focused you start looking at everything you did wrong. You go over it with a fine tooth comb. You question all your beliefs and ideas. No longer are you willing to just take things at face value. You want to know what works and what doesn’t and so you finally get serious.
Paul Tudor Jones remembers reflecting on his mega-loss and getting so depressed he wanted to quit. But then it hit him:
“It was at that point that I said, ‘Mr. Stupid, why risk everything on one trade? Why not make your life the pursuit of happiness rather than pain?’
That was when I first decided I had to learn discipline and money management. It was a cathartic experience for me, in the sense that I went to the edge, questioned my very ability as a trader, and decided that I was not going to quit. I was determined to come back and fight.”
Real loss equals real wisdom.
Without that loss none of the lessons make any sense to you whatsoever. You’ll think you’re different and that the rules don’t apply to you.
But they do. They apply to everyone. No exceptions.

Step Five: Learn the Age Old Lessons the Hard Way

What is it about the human mind that makes us learn all our lessons the hard way? We read the great wisdom of the ages and promptly ignore it.

Be like water, my friend.

Maybe that’s just the meaning of life? We all have to go through the same struggles and make our own mistakes and live the great story again and again.
After my big NEO loss I reflected on everything I’d done wrong and it hit me like a diamond bullet between the eyes. I realized I didn’t know how to make decisions when I was under fire. I just froze like a deer in headlights. I knew the market had turned and that NEO was going down and I should get out but I couldn’t pull the trigger.
Internally, I just couldn’t accept the loss. I was in denial. I was a good trader and careful or at least I thought I was but now I was faced with a new reality.
I wasn’t as good as I thought I was. And I couldn’t accept the reality in front of me. I couldn’t put it behind me and move on.
I should have sold that NEO shit stack long before it cost me a big chunk of change. Instead I road that loser all the way into Hell instead of cutting my losses.
As Tudor Jones says “losers average losers.”

People love to hang onto losers. They love the pain. Oh they won’t admit it but they do. Pain is drama. And people love drama.
Either that or they imagine the market merely lost its mind for a minute. The project is a good project. Things will turn around.
Except more often then not they don’t turn around or they turn around too late and because you held so long you can’t make up that loss.
And it doesn’t matter if gold is good or a company is good or a project is good. Sometimes that doesn’t mean a damn thing to the market and it just tanks. Saddling up that bomb and cowboy riding it to the bottom is always a disaster.
NEO taught me the most important lesson of all.
More importantly I now understood the lesson:
“Cut your losses, let your winners run.”

Step Six: Money Management

The ancient wisdom really boils down to two words: Money management.
Cutting losses is one of those key principles that everyone has to learn. It’s not enough to simply trade the market, you have to know you’re going to get things wrong a lot of the time. And that means you have to protect your money at all costs.
That’s just basic probability.
Paul Tudor Jones says “I am always thinking about losing money as opposed to making money…I have a mental stop. If it hits that number, I am out no matter what.”
Money management comes down to a few critical principles:
1) Keep your position sizes small to minimize risk
2) Ruthlessly cut your losses.
3) Always use stops.
4) Don’t use too much leverage
5) When you start losing, start trading smaller.
6) When you go on a bad streak, get out of everything and take a break.
7) If you get in a bad trade, get out immediately because you can always get back in later.
All of these principles work in tandem to protect your money.

Don’t throw good money after bad

I learned this the hard way yet again just the other day, when I went a little too heavy on a leveraged position after a strong winning streak.
The mistake was easy to see in retrospect.
What blinded me at first was that I’d gotten masterful at setting my stops. One of my tricks is to set a limit stop price far above or below the trigger so it always gets filled. I’d never had a stop not fill and I’d never gotten liquidated. I don’t get liquidated because I use just enough leverage to make a difference but not enough that the market would only have to move a few percentage points to kill me off.
I put in my trade, set my stop and went to bed.
When I woke up in the morning and checked in I saw I was down 29%. My stop never triggered. I wasn’t liquidated because I hadn’t over-leveraged but it didn’t matter.
I was sick to my stomach.
So what did I do?
Number two, ruthlessly cut loses.
After a few minutes of feeling sorry for myself and thinking I should hold on because maybe it would come back I shut that stupid voice up and sold. I cut that loss immediately. I took it and moved on.
That’s when I understood once more that all the principles work together in concert.
If the position size had been smaller the overall loss would have been smaller. But because I hadn’t used too much leverage I hadn’t gotten liquidated so I was still very much protected.
Low leverage, small positions and stops all work as one. Sometimes one of these risk management tools fail you and the others kick in to help. It’s like the seat belt and the airbag.
Sometimes the seat belt isn’t enough but the airbag is there to save you.

Step Seven: Stop Following Others

It may seem strange to say that I don’t follow other traders or the news but I don’t follow any of them anymore. I may occasionally glance at a chart of a trader who I really respect and see if it matches with my sense of the market but it’s incredibly rare. I might also check in with a trader who I know well and who’s had success over the long run.
And then I just do what I want anyway.

You can go your own way.

In the end you have to follow your own light.
You have to get so good that you trust your own analysis above all else. When you make a mistake you need to know you’re strong enough to figure out what it was and fix it the next time.
If you’re meant to be a good trader you will be. It’s as simple as that.
Ed Seykota is one of the best traders profiled in Wizards. He says is best:
“It is a happy circumstance that when nature gives us true burning desires, she also gives us the means to satisfy them.”
If you have that burning desire to trade and to win, you’ll find a way and you won’t need to follow anyone else once you get your feet wet.
I have my school of traders but my main lesson to them is simple. Learn from me and then move on. Become your own master. Don’t sit at the feet of gurus your whole life.
As for the news? Nothing but poison. Turn it off as fast as you can.
I highly, highly recommend every single human being take a news fast for a month. Disable anything related to news on your phone feed. Unfollow everyone on Facebook. Don’t read the Twitter stream. Get a site blocker for when you’re working and use it frequently.
I guarantee you, you will not miss out on anything. If something really, really big happens you’ll hear about it because people will talk about it. If it’s not big enough to be on everyone’s lips it’s not worth hearing about.
Here’s another thing I guarantee. You will be mentally, emotionally and spiritually healthier by an order of magnitude. Your anxiety will decrease as will your confusion and fear.
You’ll probably end up extending the news fast indefinitely. I know I did.

I could care less about Google News or which coin some random person on the Internet thinks is going to the moon tomorrow based on astrology and hope. Probably the last time I followed news was during the China crisis. And if I had to do it all over again, I wouldn’t read a word of it this time. I do occasionally read one magazine that I like with strong, consistent journalism but even that is less and less frequent, maybe once a month or every few months and mostly because there is one story I want to read in depth.
When you give up on the news you’ll be in fine company.
Ed Seykota said “eventually I became more confident of trading with the trend and more able to ignore the news. I became more comfortable with the approach.”
I have not met a single good trader who is a news junky even though the average trader is a hopeless news junky. They want a reason for the market to go up or down. They can’t face that it’s random chaos and the push/pull of a billion emotional monsters.
So writers come up with a good reason for why the market made a move. Interest rates changed. A trade war looms. A big soybean shortage struck. Some of these are probably factors but it’s really impossible to use that news in any effective way 99% of the time. The other 1% of the time it is but so what? Is it really worth watching 99% white noise to get that?
Even worse, news is about conflict and tragedy. It’s about pain and suffering. It’s about extraordinary events.
But the more you watch it the more you think those extraordinary events are normal events.
Plagues happen every day. People get shot up around the corner every few seconds. A baby is butchered every ten minutes in your town.
If you’re born in an insane asylum and everyone is screaming all the time you think it’s normal.
It ain’t normal.
You’re hearing about statistical outliers and it does nothing but warp and derange your mind.
The news is poison.
Bite your arm, suck that venom and spit it out for good.

Step Eight: Develop Your Own Style

If you make it this far, you’ve come to the final step on the journey of trading mastery.
What’s that?
Develop your own system.

I used to study Kung Fu. I noticed that most people were obsessed with lineage. Who was the great master that taught their great master in an unbroken line over five hundred years? Did the system change? Was it passed down perfectly and directly?
I soon realized this kind of thinking was total madness. Of course the system changed. Each master learned new lessons through his own life experience and added that to the system. It he didn’t, he was no master. In fact, he probably sucked horribly if he just photocopied what his teacher taught him and passed it down to you.
And I also found myself thinking about the first person in that line of legendary martial artists. If you go back far enough, eventually you get to someone who started the system. That brings up one inevitable question:
Who taught them?
The answer is obvious.
They taught themselves.
And that is what the absolute best of the best do in all fields. They don’t follow. They create.
The old Kung Fu masters didn’t just learn from someone else and regurgitate it. They took what they learned and modified and improved it. They studied nature and themselves. They watched the movement of snakes and birds and they tried to tease out the secrets of those animal powers. They wanted to move as fast as a snake and strike like a tiger. They had everything they needed by observing the world around them.
You must become the master. When you get there you’ll find there’s nobody handing out a belt. You’ll be the final judge in your journey.
And that means eventually you’ll need to develop a trading style that perfectly fits your own personality, your own strengths and weaknesses. If you’re just following someone else’s picks blindly you won’t have to strength to stay in a trade when the going gets really rough. That kind of confidence only comes from within.
To do that you’ll have to look deep inside and figure out what you really want from the world.
As Ed Seykota says, “Everyone gets what they want out of the markets.”
Some people like to lose. Some people like to play the Martyr. Some folks like to be popular. Others love to be contrarians and bet against the crowd. Still others like to sound smart at parties. But they don’t like to make money. They might even think it’s dirty or evil and they self sabotage.
Whatever your weakness the market will happily feed it to you. If you love the excitement of winning big and then losing it all and making it back again, you’ll get that too.
Ed went further: “I think that if people look deeply enough into their trading patterns, they find that, on balance, including all their goals, they are really getting what they want, even though they may not understand it or want to admit it.”
But the best traders do want to make money. They have a deep passion for the markets and a burning desire to win. To do it they all come to the same understanding eventually by reflecting deeply and transcending their own human limitations to become the best of the best.
And when they do they’re ready to walk their own path, a lonely path, but a joyous one too:

Yoda from The Empire Strikes Back

The path of the master.
They no longer need to read any more books or listen to anyone else or follow anyone else’s star.
They become their own guiding light.
They live and die by their own decisions. When they win they don’t get too high. When they lose they don’t blame anyone but themselves.
And they don’t need any outside validation or praise or judgement.
That’s because after all that time and effort and suffering, they finally knowwhat they’re doing. It’s not arrogance. It’s an internal compass that is unflinchingly accurate, developed only through dedication, perseverance, persistence and passion.
It’s earned over time. A long time. Nothing else can give it to you.
It can’t be bought, bargained for, or cheated. There are no short cuts and there never will be.
And all the praise and validation the legendary trader will ever need will show up in the only place that matters.
Their bank account and crypto wallet. 
Posted: March 18, 2018, 1:15 am
Import taxes of any kind are a stupid idea, we will succinctly explain why.  Until this idea, Trump has had a fairly good track record if judged only by the correlation to the stock market.  The import tax is the first major mistake, and shows that he really doesn’t understand international finance and has not been able to hire a decent advisor to explain him that the world has changed in the last 50 years.  We explain this and more in our ground breaking work Splitting Pennies. 
Trade Wars are not a new thing in fact they’ve been a tool of state sponsored mercantilism since the beginning of time; tax or ban foreign goods in order to spur the domestic economy.  There’s a small problem though.  The world is today completely intertwined, interconnected, and intermingled.
Did you know, that Budweiser, a company which is more American than apple pie, is owned by InBev, a Belgian company?  Did you also know that of the 15 Budweiser breweries outside of the United States, 14 of them are in China?  So what does that make Budweiser – American, Chinese, or European?
Regarding the car industry, nearly every Asian manufacturer makes cars right here in USA.  Kia, Hyundai, Toyota, the list goes on and on.  So we all know that Toyota is Japanese.  Or is it?  Land Rover is British, but it was bought by Ford, a US publicly traded company (F).  Ford’s most complex robotic factory is in Brazil.  Ford operates in nearly every country in the world, and their business is sustained by a sophisticated foreign exchange operation managed on their treasury desk.  Ford notoriously hired Muslims, Blacks, and other workers that had trouble finding jobs at other companies.  Who owns ford now is a global mix of citizens from every country in the world, foreign governments, and you can rest assured municipal pension funds, state pension funds, all own a piece of this American icon (F).  So what is American, anyway?
Trump’s heart is in the right place, the idea of rebuilding USA’s manufacturing base, creating jobs at home, reducing ‘offshoring’ – should be a priority of America first and it makes economic sense.  But the way to accomplish it is not through import taxes or to start a trade war.  Companies like Apple (AAPL) need to be incentivized in other ways to move their factories from China to Kansas.  Grants, tax incentives, government if then contracts (for example if Apple moved its phone manufacturing to USA the government could require USG employees to use iPhone for Security reasons.)  Or another solution, we can cut the military budget in half, and instead of building missiles and bombs, we can build technology parks in places like Kansas where there is plenty of cheap land.  We can build factories and retask soldiers to do non-military functions like planting trees or building the useless wall with Mexico.  We should invest in robotic factories and state of the art design organizations, like they have in Europe and Korea.  Farming can be hydroponic and automated.  There are thousands of ideas, and thousands of people who have thousands of ideas and who are capable of implementing them.  But we are not listening to those people, or supporting them.  USA has plenty of natural resources, real estate, and most importantly business innovation motivation to act as a natural global incubator for global business.
Instead of import taxes we should incentivize more foreign businesses to move here, such as by creating foreign ‘tax havens’ like Delaware, and providing privacy to foreign entities who would otherwise go to Switzerland or the Cayman islands.
The tax reduction plan was a huge win for Wall St. and Main St.  The idea of import taxes is the opposite.  We should encourage business growth not stifle it.  There are other more intelligent ways to spur the domestic economy.  We explain this and more in our ground breaking work Splitting Pennies. 
Posted: March 11, 2018, 10:50 pm