We apologize we have had problems with our data provider. They have added digits to the data without prior notice causing real problems. We are now in the process of switching data providers. We will announce who our data provider will be when that feed is installed.

Other than individual bank stocks, Friday’s EBA report had little overall effect on core markets as we heard nothing that we were not already familiar with. The Nikkei opened around 1% lower and then spent the rest of the day trying to recoup opening losses, which was pretty similar to the Hang Seng. Shanghai, on the other hand, found it extremely difficult to bounce having just seen weaker PMI at 49.9 against an expected 50 forecast. Services were marginally better but failed to boost confidence. In late US trading both China300 and the Nikkei have declined around 1% from the cash close.

It really is expected top be a quiet start to the week as we have plenty to talk about at the end and so on the back of poor PMI numbers, Europe traded heavy. Peripheral markets (Spain and Italy) were way below expectation but Germany and the Eurozone in general performed better and that reflected in the indices. CAC, UK and IBEX were all down around -0.75% whilst DAX closed with marginal a loss. UK PMI was even worse than some peripherals with a 48.2 print against expectations for a 49.1. This news hit GBP from the days highs to close down 0.6% with many expecting the BOE to act on Thursday. Unicredit did not help as with its shares down 9% before being suspended. HSBC, Barclays, Deutsche and RBS all were down around 2%.

The continued weakness in oil and the general lethargic trading volume we saw small losses for both the DOW and the broader S+P whilst the NASDAQ continues to perform. ISM came in slightly lower than forecast (52.6 against an expected 53) but given summer may have finally arrived there is still plenty to play for later in the week. Friday NFP will be the focus for many traders this week and with expectations so low (180k and 4.8%) from previous 287k and 4.9% it could well be a busy Friday afternoon session.

US Treasury curve saw some steepening today with 2/10 closing +3bp at +83.5bp. 10’s lost 7bp today closing at 1.52%. Europe also saw weakness in fixed-income markets despite summer trading conditions. 10yr Bunds closed 2bp higher (less negative) at -0.06%, closing the US/Germany spread at +158bp. Italy closed 1.18% (+1bp), Greece 8.02% (+4bp), Turkey 9.47% (+2bp), Portugal 2.87% (-3bp) and UK Gilt at 0.73% (+4bp). UK Gilts were higher despite BOE rate cuts expectations but we do have additional supply tomorrow of £2.5bn 6yr paper.

HILLARY CLINTON

@ real DonaldTrump thinks that democrats care about his opinion, how does it feel putting your stuff where it doesn’t belong ?

DONALD J TRUMP
@Hillary Clinton. Ask Bill.

The battle between Hillary and Trump has taken to Twitter. Hillary is way out of her league here. The media turned on Trump for saying Russia should release Hillary’s emails. Obama is the one that said it was Russia who hacked the DNC without any evidence, but the media has shown their true colors in desperately trying to turn Trump’s comment into major news all day long.

 

Meanwhile, what the mainstream media did not cover were all the protests in Philadelphia. They erected unscalable fences to keep them away from the convention and the TV cameras. The City of Philadelphia had to approve four massive protests but they ensured such events would not be near the convention. For the largest of the four pro-Sanders rallies approved, more than 30,000 people attended weeklong demonstrations called “March for Bernie at DNC.” Then there was the group called Black Men for Bernie who held a “We the People Restoration Rally” at Thomas Paine Plaza across from City Hall on July 27-28. The purpose of the rally was “to address economic inequality, human rights, poverty, criminal justice reform and lack of ownership,” according to the city’s permit approval document.

The DNC emails showed how the primaries were rigged against Bernie, and unsurprisingly the Democratic protesters who say they will now vote for Trump have only appeared on local TV. We now have 100 days to go, which is a lifetime in politics.

The arrogance of those in power is typically beyond belief. Those in the International Monetary Fund have been so biased that their own refusal to review what is going on within Europe has been a great contributor to the demise of the Eurozone. It has now been acknowledged that the IMF’s top staff misled their own board based upon biased misjudgments concerning Greece. Their pro-euro stance blinded them, for they never considered that the structure of the Eurozone might be wrong. They ignored all the warning signs of an impending crisis because they simply never understood modern monetary/currency theory. The IMF lacks anyone with basic trading experience on how the currency markets function and that is the cause of this problem.

The IMF’s tangled political role in the Eurozone debt crisis as a member of the Troika has created a damaging episode in the history of Europe. The IMF’s watchdog has described the organization as having a “culture of complacency” prone to “superficial and mechanistic” analysis. The watchdog traces a shocking breakdown in the governance of the IMF, leaving it unclear who is ultimately in charge of this extremely powerful organization. Now with Christine Lagarde ordered to stand criminal trial in France, the board has once again ignored its duty and merely said it stands by her.

The entire policy of negative interest rates has devastated savings and ruined the banking system. Month after month has gone by without any recovery, yet the policies are never reviewed – they are always assumed to be correct. The IEO report has blasted its own process. It reported that many documents were prepared outside the regular established channels; written documentation on some sensitive matters could not be located.

In a truly astonishing admission, the IEO report stated plainly that its own investigators were unable to obtain key records or penetrate the activities of secretive “ad-hoc task forces,” but would not name who was behind the obstruction to hide the truth. We are witnessing a degree of corruption within government that is worldwide.

The armory at the U.S. base at Stuttgart, Germany, was broken into and a weapons cache was stolen. The U.S. Army has begun a criminal investigation, but they are declining to publicly state what was stolen or even how many weapons were stolen. It appears that the people involved are unknown, but may be linked to the Islamic terrorists who have infiltrated Germany under the refugee program.

This is not something that is being widely reported in Europe or even the mainstream media.

The documentary, “Hillary’s America,” looks into the secret history of the Democratic Party and Hillary’s rise to become the presidential candidate. I find it rather astonishing to see a movie out before the election about Hillary’s crazy history.

One would think that the Democrats would have preferred Joe Biden. Hillary plays dirty and many fear getting in her way. Yet, the Democratic Party determined Hillary would rule Washington as the first woman president. She is such a feminist that this is her only real goal, not helping the nation.

I have not seen this movie to attest to its veracity. I cannot recall a presidential election that was ever this nuts. I understood that this would be a crazy period economically back in 1985 when our computer was highlighting 2016 as a crazy economic year. I never anticipated such a chaotic election as we have today. The burning question is why the Democrats went along with Hillary rather than someone who did not have such a crazy cloud over them.

The documentary, “Hillary’s America,” looks into the secret history of the Democratic Party and Hillary’s rise to become the presidential candidate. I find it rather astonishing to see a movie out before the election about Hillary’s crazy history.

One would think that the Democrats would have preferred Joe Biden. Hillary plays dirty and many fear getting in her way. Yet, the Democratic Party determined Hillary would rule Washington as the first woman president. She is such a feminist that this is her only real goal, not helping the nation.

I have not seen this movie to attest to its veracity. I cannot recall a presidential election that was ever this nuts. I understood that this would be a crazy period economically back in 1985 when our computer was highlighting 2016 as a crazy economic year. I never anticipated such a chaotic election as we have today. The burning question is why the Democrats went along with Hillary rather than someone who did not have such a crazy cloud over them.

QUESTION:

Hi Mr. Armstrong,

As you have stressed many times, your Socrates computer system has hundreds of years of data. The US political system has hundreds of years of momentum (or perhaps inertia) behind it. Do you think Donald Trump can really change where we are headed, IF he were elected President?

Thanks as always,

MB

ANSWER: No. What he can do is perhaps pave the way to change what is coming, which is a new form of government. Career politicians are causing us to suffer. Perhaps he will be able to highlight that problem and there may be more of a confrontation with members of Congress. He would tend to have no problem exposing them and what is really going on.

He cannot prevent the crash and burn. Nobody can do that. Perhaps he can highlight the real problem. Moreover, he might be less likely to just sign whatever they put in front of him as they do with career politicians.

We are headed toward a complete political change. That is unquestionable. So I would look at Trump more so as assisting the change that is already coming about.

Hillary Clinton & Michael Bloomberg at the Goldman Sachs new building construction

Former Mayor of New York City Michael Bloomberg had the audacity to deliver a speech at the Democratic Convention saying, “There are times when I disagree with Hillary Clinton. But let me tell you, whatever our disagreements may be, I’ve come here to say: We must put them aside for the good of our country. And we must unite around the candidate who can defeat a dangerous demagogue.” Bloomberg began at Salomon Brothers, the notorious firm that was shut down for manipulating the US government bond auctions. It was Bloomberg who defended Wall Street against the protest “Occupy Wall Street” and arrested people for exercising their First Amendment Rights.

Bloomberg Politics’ Washington News director Kathy Kiely resigned because Michael Bloomberg will not allow freedom of the press. She said when she resigned in January 2016, “I think that Michael Bloomberg has built a terrific news organization but that he needs to liberate it to cover all the news, even the news about him.“

In my own case, Bloomberg erased all the files on me, so if you put my name into their system the bulk of everything is gone. We even used to publish on Bloomberg. That’s gone. Bloomberg denied there were any stories they published on TV. The movie producer found it elsewhere and had to go to Bloomberg News to say he found what Bloomberg said did not exist. So Bloomberg is not exactly a fair or unbiased organization. They would NEVER publish my allegations against the bank. I believe it was always a one-sided reporting affair to protect the government and the banks.

The question this invokes: Is Michael Bloomberg the dangerous demagogue? Will the real dangerous demagogue please stand up!

Bill knows that other people write such speeches anyhow and they are never the real words of the speaker. So what the heck — might as well catch a break from the pretended nonsense anyhow. From this perspective, it really does not matter, Democrat or Republican, as both sides are scripted.

Trump says a lot of crazy stuff, mainly because he is not reading from scripts like everyone else. Perhaps that’s why he is more entertaining. If Hillary is president, the press will listen to her every word as the public tunes her out. If Trump becomes president, he may keep everyone focused just so that they can listen to what he says next. Perhaps even Bill would stay awake then.