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Dr. Fly

18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.

Addressing the Senate Floor, Schumer Says Trump is Trying to Bully Sessions Out of Office

Sen. Chuck Schumer (D) addressed the Senate floor today, discussing Trump’s Twitter attacks on AG Sessions (I can’t believe I just wrote that), admonishing his character for publicly outing his first establishment ally in the Senate.

“We should all take a moment to think about how shocking these comments are on a human basis,” Schumer said on the Senate floor about some of Trump’s recent statements. “This was the first person who stumped for Donald Trump, who was with him through thick and thin. And now, even if the president has disagreements with him, which I think are ill-founded, self-centered and wrong, you don’t ridicule him in public, someone who is your close friend. That speaks to character.”

It’s clear that President Trump is trying to bully his attorney general out of office. How can anyone draw a different conclusion?” Schumer said, wondering why Trump aired his grievances in public and not in person. “He wants him out.”

Schumer posited the idea that Trump was jockeying to get rid of Sessions before the August recess, at which point he’d appoint a new AG, who would then fire Robert Mueller. Makes sense.

“Before this scheme gains wings, Democrats will never go along with the recess appointment if that situation arises. We have some tools in our toolbox to stymie such action. We’re ready to use every single one of them, anytime day or night,” he said.

“I cannot imagine my friends on the Republican side, particularly in the Republican leadership … would be complicit in creating a constitutional crisis. They must work with us and not open the door to a constitutional crisis during the August recess.”

Creatures from Twitter weigh in.

What do you think? Does Trump have the gumption to pull it off?

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A Gigantic Short Squeeze is Currently Underway

Isn’t it amazing how the market goes up every day, in spite of the political turmoil?

There are two main pillars to today’s rally: banks and commodities. Both of these sectors are, in a sense, Trumpion plays. But I don’t think they’re rising because of him. Banks are rising thanks to rising yields and widening spreads. The 10yr is up nearly 7bps to 2.32%, while the 2 yr is up just 3bps to 1.394%. That’s a widening of 4bps in the yield curve in one session — pure profits for bankfags.

Take a look at the winship.

SIVB +3.6%, C +3.1%, BAC +2.7%, SCHW +2.3%

The kinetic action is in the commodity sector today. This rally is being sponsored by China, courtesy of FCX and CAT earnings beats. The sectors are up nearly 4%, and both copper and WTI are up more than 3% for the session. However, I’d advise you to tread carefully with this trade. Last year in July, FCX gained 17%, only to cede those gains and more, enduring a -20% drubbing in August.

Nevertheless, traders are swimming naked with each other today, enjoying the scenery, sopping up oversold commodity stocks. As is the case with all sharp rallies, short squeezes happen. Right now, here are the standouts amongst stocks most heavily shorted in the commodity sector.


That is the usual shit, isn’t it? As soon as commodities break out, all of the resource misfits pile into RIG, CENX, ATI, CLF and X — only to get thoroughly dispatched later on in the week.

Retail is bouncing nicely too, but I rather not even mention that industry.

Tech is taking the day off, a well deserved one at that. Maybe it’s due to GOOGL earnings or maybe the sector is enduring a little profit taking. Either way, there’s not much going on there, aside from losses in MU, GOOGL, SHOP, VEEV and SANM.

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Trump Takes Swipe at Sessions Again, Makes Washington Post Enemy #1 in the Media

The President was tweeting late last night and early this morning. One of the more notable outbursts was against his AG, Jeff Sessions. He’s probably doing this to force Sessions to resign, a plan that should work out in the end. Some supporters of Trump might view this as a positive, since Sessions has proven the only thing he’s interested in doing is going after marijuana dealers since taking office at the DOJ. Still, it’s never a positive to see the head of the DOJ maligned by the President.

The President also went after the acting head of the FBI. I know that might sound bad, but these department heads are flawed people and many deserve to be aired out.

Also notable is the President’s number one enemy seems to be WaPo now, with CNN dropping to a close second. In a series of tweets, Trump takes on the Washington Compost, owned by Amazon’s Jeff Bezos.

The market is ignoring the Amazon tax references, because Trump is like the boy who cried wolf at this stage. No one believes him.

In an Oped published last night, the Washington Post Editorial board declared the President persona non grata, as it pertains to protecting the American people from the very menacing threat in Moscow.

Congress’s action is nevertheless essential. It has become all too evident that Mr. Trump cannot be trusted to protect vital U.S. interests against persistent Russian aggression. He has shown no interest in stopping Russian cyberattacks, including further assaults on the U.S. electoral system. He appears ready to hand Mr. Putin major concessions for nothing, from the return of the compounds to withdrawal of U.S. support for rebel forces in Syria. Why Mr. Trump pursues these actions remains a mystery. But Congress is right to limit the damage.

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Freeport McMoran, Caterpillar Crush Earnings, Both Cite China as Engine of Growth

Copper is higher by more than 3%, and oil +2%. Earlier this morning, both FCX and CAT crushed numbers, citing China as a strong engine of growth. For bulls, this is exactly what you wanted to hear. Hence, we’re enjoying a commodity led rally today — because China, err, likes and needs commodities.

Here are the top performing sectors, early going, which are also Trump plays.

Notes from the FCX quarter.

Not committing to projects now…
China copper demand has been better than expected.
Seeing higher than normal copper supply disruptions.
Saw a high level of worker absenteeism which had an impact on mining operations.
Indonesia Talks- Moving to the next stage with a mutual optimism. Says both sides closer to objectives with Indonesia; Seeing more Senior level action in Jakarta that it has seen in the past; At point of moving discussions to direct talks with government officials; talking about extending operating rights and getting assurances that would give them the confidence to invest in big under ground projects; Talks about any divestitures have to be at fair market value.

And, notes from the CAT quarter.

Reports Q2 (Jun) earnings of $1.49 per share, excluding non-recurring items, $0.23 better than the Capital IQ Consensus of $1.26; revenues rose 9.6% year/year to $11.33 bln vs the $10.96 bln Capital IQ Consensus.

As a result of increased demand across many end markets and disciplined cost control, Caterpillar is raising its 2017 outlook. Some risks remain in the outlook, including weakness in the Middle East and Latin America, as well as geopolitical and commodity risk

Co issues upside guidance for FY17, sees EPS of $5.00 vs. $4.32 Capital IQ Consensus Estimate

Meanwhile, the co raised its FY17 sales guidance to $42-44 bln vs. $40.74 bln Capital IQ Consensus Estimate, up from $38-41 bln, which was given in April 2017

Back to the quarter…

The 10% in increase in YoY sales was primarily due to higher sales volume, with the largest increase in Construction Industries mostly due to higher end-user demand for construction equipment
Sales volume for Resource Industries increased due to improved end-user demand for aftermarket parts and the favorable impact of changes in dealer inventories. Energy & Transportation’s sales were higher mostly due to increased demand for aftermarket parts for reciprocating engines. Favorable price realization in Construction Industries also contributed to the sales improvement. The unfavorable impact of currency was mostly the result of a weaker euro and British pound. Financial Products’ segment revenues were about flat

Sales increased in Asia/Pacific, North America and Latin America, and were about flat in EAME

Caterpillar’s financial position continued to strengthen. Machinery, Energy & Transportation operating cash flow was $2.0 billion during the quarter, and ME&T’s debt-to-capital ratio improved to 38.6 percent, compared with 41.7% at the end of the first quarter of 2017

FCX is up 13% for the day. Interestingly, it was up 17% in July of last year too, only to shed 20% in August.

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Tulsi Gabbard: US Addicted to Regime Change; CIA Funded and Armed Al Qaeda in Syria

In a brazen attempt at honesty, Rep. Tulsi Gabbard (D) of Hawaii went on Tucker Carlson tonight and declared the US was addicted to regime change and that we armed and funded Al Qaeda in Syria.

In late 2016, Gabbard introduced the ‘Stop Funding Terrorist Act‘ to Congress — but hardly anyone on the left or on the neocon right listened. Over the course of the past two years, we’ve seen Russia on the right side of history, aiding the only legitimate government in Syria — which has provided the media with endless demonization campaigns depicting both Assad and Putin as monsters, who both gassed innocents and bombed out hospitals, whilst ignoring the horrors and the blind hatred of the people attempting to overthrow Assad.

The stated goal of Putin’s meddling in Syria was to protect Russian’s sole Mediterranean port and aid an ally of Russia who has been loyal to the Kremlin for decades. US policy has been soft on ISIS and hard on Assad, seeking to support so called ‘moderate rebels’ to overthrow him. The most important fallacy about these ‘moderate rebels’ is that they are, in fact, an Al Qaeda spinoff, working in conjunction with ISIS to install the Caliphate in Syria. In other words, we’re now supporting the same people who allegedly attacked us on 9/11.

When Trump ended the brainless CIA project to arm and fund terrorists in Syria, the media painted it as ceding to the demands of Putin. However, what our lawmakers have failed to do is sell America on the idea of extended war in Syria, which would undoubtedly cost inordinate amounts of money and lives. Instead, they simply point towards isolated events to monsterize Assad and draw on the feeble emotional strings of the American normie.

If US policy is to not negotiate with terrorists, then why the heck are we arming them? Let the regional players sort Syria out and leave us the hell out of it.

One of the only sane democrats, Tulsi Gabbard, weighs in.

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Obama’s CIA Director, John Brennan, Calls for Executive Branch Coup if Trump Fires Mueller

The hard hitting Wolf Blitzer went for the kill in this clip with former DNI Clapper and CIA Director Brennan, asking the latter to describe what should be done if Trump were to fire Mueller. His answer for fairly straightforward, describing America as a nation in crisis.

“I think it’s the obligation of some executive branch officials to refuse to carry that out. I would just hope that this is not going to be a partisan issue. That Republicans, Democrats are going to see that the future of this government is at stake and something needs to be done for the good of the future.”

The very trustworthy and overflowing human vessel of integrity, John Brennan, is calling for an executive branch coup. Just refuse to listen to the President, arrest him and his family, and be done with him. After one year of investigations, I think it’s clear to everyone in the country that Trump is a Russian agent, totally dependent upon Russian money to further his hotel empire. Without the Ruble and Russian financing, Trump and Kushner would be reduced to rubble.

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Market Shrugs Off Early Weakness: Banks, FAANG, That Fag Pub Lead the Way Higher

You must be wondering with less than 50% of stocks higher for the day, where the heck were the gains? The Nasdaq rose more than 23, with both the Dow and the S&P lower. Do not fret, for Le Fly will show you exactly where the money went, which, incidentally, is the same place its been for several years now.

While everyone else suffered, the greedy FAANG lifted by almost 1%. All that matters in this market are a few handful of stocks — just like real life where only a few elite people are important. The rest of the market could burn in hell, as far as the Nasdaq is concerned.

Banks bounced, but no one cares.

And, lastly, That Fag Pub continues to show why it’s the favorite locale on Wall Street these days.

Personally, Friday’s purchases netted just 0.15% today — which is wildly better than the SPY. That is the stated goal, so I’ll take the win. I do not care to compete versus the indecorous FAANG or Nasdaq index, due to a depressed sharpe and heightened risk profile. Any man of property and leisure will tell you, first and foremost, that any investment strategy worth its salt must be both productive and risk averse. While Le Fly, aka Señor Tropicana, had been known in the past for river boat gambling, and acting a fool amidst the Third Estate in the marketplace, I am a reformed man and do not care to partake in tomfoolery anymore.

Signing off for now.

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CNN Cites Anonymous Sources Who Declare Rex Tillerson is Thinking About Resigning from Secretary of State

They’re adorably dubbing this one a ‘REXIT’, an obvious play on words to commingle one of their bitter defeats (BREXIT) with a potential massive windfall for team CNN: A Rex Tillerson resignation inside the first year working for President Trump.

CNN Fake News Reports.

Tillerson has a growing list of differences with the White House, including a new debate over Iran policy and personnel. His frustration is hardly a secret and it has spilled out publicly at times. But friends sense a change of late.

For weeks, conversations with Tillerson friends outside of Washington have left the impression that he, despite his frustrations, was determined to stay on the job at least through the end of the year. That would allow time to continue efforts to reorganize the State Department and would mean he could claim to have put in a year as America’s top diplomat.

But two sources who spoke to CNN on condition of anonymity over the weekend said they would not be surprised if there was a “Rexit” from Foggy Bottom sooner that that.

Both of these sources are familiar with Tillerson conversations with friends outside Washington. Both said there was a noticeable increase in the secretary’s frustration and his doubts that the tug-of-war with the White House would subside anytime soon. They also acknowledged it could have been venting after a tough week, a suggestion several DC-based sources made when asked if they saw evidence Tillerson was looking for an exit strategy.

Amusingly, Trump supporters seem to be elated with the specter of this news. It seems that most supporters of the President are disenfranchised with the President’s cabinet picks, save Bannon — which begs the question: if Trump is such a good delegator, why the hell did he make so many poor choices for his cabinet?

Anti-Trumpsters and deep state shills are actively circle jerking over each and every negative White House rumor, with their eyes fixed on the grande prize: a Trump impeachment.

Some argue that the President is barreling towards a Nixonian “Saturday Night Massacre“, whereby his AG and Deputy AG resign after failing to fire the special counsel. Judging by the President’s tweets this morning, the Nixon timeline might just replay itself here.

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Victim #2 Reported at Virginian Chipotle, Courtesy of Norovirus

The AP is reporting a second person has tested positive for norovirus, after eating in a Virginian Chipotle. Judging by the pin action in the stock price since that occurred (-13%), you’d think people were contracting aids after eating faggot burritos there.

Either way, America now HATES Chipotle. Considering the undeniable facts that white Americans love to eat pseudo Mexican fare, this has to be boolish for JACK, owner of Qdoba.

A Virginia health official says a second person has tested positive for norovirus after eating at a Chipotle before it was temporarily closed last week following reports of illnesses.

David Goodfriend, director of the Loudoun County Health Department, says two people now have tested positive for norovirus. Goodfriend previously said a second confirmed case would give a strong indication norovirus was behind the reported illnesses.

Chipotle reopened the location Wednesday after a “complete sanitization.” It noted its procedures to deal with the issue quickly and said its food was safe to eat. Its stock nevertheless fell, underscoring its vulnerability following past food scares.

Norovirus is a leading cause of illnesses from contaminated food.

Goodfriend says some of those sickened were Chipotle employees. Officials planned to release more information later Monday.

Ah, looky here, it appears JACK sucks too — down 15% for 2017. This is the purest form of corporate idiocy you’ll ever see. If I was the CEO of JACK, I’d be running television ads 24/7, wildly besmirching CMG and creating a juxtaposition between Qdoba non poisoned fare and Chipotle. However, being JACK likely has something to hide, they’re staying low key.

Maybe they’re secretly poisoning people too?

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Greece to Issue New Debt For the First Time Since 2013

In spite of the fact that Greece has an astounding $327 billion in debt, or 180% debt/GDP, they’ve announced they’re going to issue more debt — which will be valued on July 25th, 2017.

On this news, Greek 5yr bonds plunged in yield to 3.4%, the lowest since the Greek debt crisis of 2012 when yields were sporting a cool 63%.

The Greek Finance Ministry said they’re looking to issue the new debt at a yield of 4.2%. But some skeptics believe it’ll likely get done between 4.3%-4.5% — hardly a yield to be ashamed of, especially when considering the fact that Greece is entirely dependent on the ECB to pay its bills.

This is all part of a larger plan to exit the EU bailout — weaning itself off the EU tit.

With the sale, the government of Prime Minister Alexis Tsipras is seeking to chalk out a path for an exit from the current bailout program, which ends in August 2018, while also capping the country’s financing needs in 2019 — expected to be about 19 billion euros ($22.1 billion). After not being able to convince creditors to reduce its debt burden and being left out of the European Central Bank’s bond-purchase program, Greece is testing the market.

It’s “perfect timing,” said Lutz Roehmeyer, who helps oversee 12 billion euros at Landesbank Berlin Investment GmbH. “It is after getting bailout money, after getting the go ahead for a debt reduction next year, after IMF said it is likely to join the bailout finally, after S&P rating action and still before ECB ends QE and started raising rates.” Roehmeyer already holds Greek bonds and plans to take part in the new issue.

The bond sale follows the successful conclusion of the second bailout review and the disbursement of the first part of the 8.5 billion-euro tranche by the European Stability Mechanism on July 10. The IMF agreed to a new $1.8 billion conditional loan for Greece on Thursday, with disbursement contingent on euro-zone countries providing debt relief.

S&P Global Ratings raised the country’s sovereign credit-rating outlook to positive on Friday, while affirming the long-term foreign currency debt rating at B-, or six levels below investment grade. The credit-rating arbiter increased its outlook from stable.

Greece is also encouraging $4b worth of 2019 4.75% debt holders to exchange for cash, especially since yields are currency in the 3s.

Not too shabby, especially when taking into account Greece is in its 3rd ECB bailout, amounting to over $250 billion and beneficiary of a draconian debt restructuring owed to the private sector that reduced face value by 53%.

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