Content originally published at iBankCoin.com

Te company pointed to a slowdown in news flow, the fact that stories were required to be deemed "false" before earning a "disputed" label, and because many people were instead drawn to clicking on the articles in question...

Facebook's Sheryl Sandberg says they are a technology company who doesn't hire journalists - so, you know, whoops?

Several Facebook employees made a post on Medium detailing the change:

"In December of last year, we launched a series of changes to identify and reduce the spread of false news in News Feed:

• We made it easier for people to report stories they think are false news
• We partnered with independent fact-checking organizations that review articles that might be false
• We reduced the distribution of articles disputed by fact-checkers
• We launched a collection of features to alert people when fact-checkers have disputed an article, and to let people know if they have shared, or are about to share, false news"

EXCEPT... 

Disputed flags could sometimes backfire: We learned that dispelling misinformation is challenging. Just because something is marked as “false” or “disputed” doesn’t necessarily mean we will be able to change someone’s opinion about its accuracy. In fact, some research suggests that strong language or visualizations (like a bright red flag) can backfire and further entrench someone’s beliefs.

The company will instead offer up alternative stories containing facts that have already been checked.

Perhaps Facebook also realized that Snopes - run by a bunch of degenerates, has a long history of liberal bias? Last year they were dressed down by the Daily Caller in a fascinating Exposé - featuring evidence of Snopes' liberal bias, several instances of flat out lies, and insight into the individual opinions of the militantly liberal fact checkers who love insulting conservatives.

Let's also remember that Snopes co-founder David Mikkelson, pictured above to the left of the morbidly obese cat - cheated on wife Barbara Mikkelson with the literal prostitute and Snopes administrator pictured in the frame below; taking her on expensive vacations around the world using (allegedly) embezzled Snopes funds while banging her like a steel drum. He then married her despite the fact that she had a website devoted to being a whore and is "past her time as an adult model."

Meanwhile, Politifact is riddled with propaganda. They are incredibly biased, funded by a Clinton Foundation donor, and not even close to being qualified to sit on an exclusive panel of Facebook "FAKE NEWS" judges.

Worst. Thought police. Ever.

Follow on Twitter @ZeroPointNow § Subscribe to our YouTube channel

First published here: http://j.mp/2E3Py3Q

Via The Daily Bell

What does desperation look like? This:

The weird thing about trees is that someday, like all of us, they die.

This tree was on its way out. In fact, the tree was removed in order to protect anyone standing under it from danger. Who usually stands under it? The press. Melania was trying to protect the same press that now attempts to skewer her over landscaping.

(Of course, if the tree broke and killed a member of the press, then they could all have a field day reporting that Trump is responsible for killing a journalist.)

The tree will actually be removed on the advice of the National Arboretum. It is only held in place by an intricate maze of cables. And Melania actually made sure they saved cutting from the tree to replant.

I felt very silly writing the past few paragraphs because the issue is so trivial. This is not important news. The media that originally reported this story (starting with CNN) should be laughed out of town. And in one way or another, they will be.

It’s not so much the reporting of this non-news that is a problem. I suppose it may be of some interest to someone somewhere. Perhaps a side link, or maybe a half page in Arborist Monthly. But the headlines! That is what really does it.

You know, the tree was actually planted by Andrew Jackson. So the media could have said, “Melania Orders Removal of Symbol of Racism,” or “Two-Hundred Year Old Monument to the Trail of Tears to Be Cut Down.”

The substance of the article missed an opportunity too. The White House had to call in tree experts, who made a report which was delivered to Melania, who sat down with the arborists and staff to thoroughly explore every option before making the call to remove the tree.

If that’s not a metaphor for the government, I don’t know what is! A dying tree, being held up by cables to preserve some remnant of a long-gone past. The desperate bid to save a symbol, to hold onto something rotting and dangerous. And then the intricate process, bureaucracy, time, and money that it takes to just cut down the freakin tree!

The media is absolutely desperate to criticize the Trump administration over anything they can get their hands on. Except that this is exactly the type of coverage Trump relishes in. Big nothing-burgers which keep his name in the news, but don’t hurt him in the least. Only anti-Trump zealots will latch on to a story like this. The rest of us, not even just the Trump supporters, will roll our eyes and stop paying attention.

And that is the dangerous part of these types of stories. What are they masking?

Did you hear about Trump’s terrible picks for the Federal Reserve Board?

Or about how Trump’s Justice Department settled the old IRS Tea Party targetting lawsuits for peanuts?

While this story played out, and Trump was “caught” golfing by CNN, here’s some other stuff that happened:

Did the FBI Conspire to Stop Trump?

Ironically the FBI investigation into the Trump Russian collusion charges has done a 360 and now points to the Democrats and FBI agents as the real criminal manipulators. But they are in too deep and have overplayed their hand.

But how bad has this government gotten that this sort of corruption at the FBI is considered boring? The FBI has long been a political tool of suppression.

Police in China Target Bloggers and Profile Communities for DNA Collection

China is a big red flag to the rest of the world on how not to govern. They intimate journalists and dissidents and monitor every aspect of their citizens’ lives. A “social credit” system has even started to score citizens based on things like patriotism and neighborliness.

But Melania approved a tree getting cut down, and that is just too fun an opportunity for the media to ignore! It fits the scorched-earth-Republican narrative too well.

She also ordered all the tree’s progeny uprooted and burned. As for the tree itself, she plans to fashion a throne, from which she will rule for a thousand years.

First published here: http://j.mp/2l89Zoq

First Appearing on HedgeAccordingly.com

Sixth in a series. Part 1, Part 2, Part 3, Part 4, Part 5

By @sellputs

Seems like everybody wants to buy in on bitcoin, and if you do, brace for a gut-tossing rollercoaster ride and another drawback, as well:  Trading costs in crypto are astonishingly high. 

Comparison: on TD Ameritrade, you can do a $10 million transaction in stocks on the New York Stock Exchange and it will cost you as little as $6.99; sell $10 million in bitcoin, and the transaction fee could come to $100,000 or more. And stocks are safer!

Opening an account with Coinbase (see Part 3 of this series), is more of a beginner’s way, admittedly, to go to the market to “buy” crypto-coins.  It also is the better option for buy-and-hold fans of bitcoin, though holding anything too long in cryptos may be risky on its face.

Coinbase imposes a fee on every transaction you undertake, charging 1.5% of the total value of the purchase or sale. And if you want to use your credit card to set up an account, Coinbase will charge you a 4% fee for the pleasure.  That’s $400 to hand ’em $10,000.

The GDAX trading platform is the more advanced way to play, ideal for day trading and high-frequency trading if you have the nerve.  It assesses no transaction fees at all as you trade, and it allows more sophisticated techniques that Coinbase doesn’t enable, such as limit orders letting you set stop-losses (sell when the price falls to a particular level) and buy limits letting you trigger a “buy” only when a coin hits the price you specified.

The platform exacts an ample vig, however, once you take cash out of your GDAX account, whether it’s an exponential windfall or the remaining shreds of cash from a bitcoin beating. GDX charges a fee of 25 to 100 basis points, or 0.25% to 1.0% of the total sum you withdraw. In some cases the fees run even higher than that.

Plus, on Coinbase and GDAX the only way to bet on bitcoin et al is to bet their prices will rise—so far, you cannot hedge that gamble by actively betting that bitcoin will actually go down in price, by selling short.  At least, you can’t do that on Coinbase and GDX and their rivals. Now, though, you can short elsewhere, via futures contracts on both CBOE and the CME

One futures contract on the CBOE involves one full bitcoin, while at the CME, one contract covers five bitcoins. Thus, the CME contract has higher leverage than the CBOE contract. The CME contract is based on the average price taken from five exchanges, while the CBOE’s contract is priced off of a single exchange, run by Gemini Trust Co. 

Those differences create gaps and fleeting, short-lived anomalies, and professional traders and their Ph.D. mathematicians will be brainstorming this one, figuring out new algorithms aimed at exploiting those spreads between the two markets.  It is unclear how much bitcoin prices could gyrate around as a result of such computerized trading.

As you read this—most of you didn’t get down this far, and for those of you who did—I’d bet you some holders of real bitcoins are slowly converting a portion of them into dollars and investing the cash in new bitcoin futures on CBOE and the CME.  In some ways that may be the ultimate sign of how bitcoin gradually will get co-opted by Wall Street and superseded by trading in derivatives-of-derivatives based on bitcoin prices.

Hold on to your hats for this ride.

Next: A new way to predict bitcoin’s pricing patterns.

First published here: http://j.mp/2liFrj5

By the SRSrocco Report,

While the U.S. Shale Energy Industry continues to borrow money to produce uneconomical oil and gas, there is another important phenomenon that is not understood by the analyst community.  The critical factor overlooked by the media is the fact that the U.S. shale industry is swindling and stealing energy from other areas to stay alive.  Let me explain.

First, let's take a look at some interesting graphs done by the Bloomberg Gadfly.  The first chart below shows how the U.S. shale industry continues to burn through investor cash regardless of $100 or $50 oil prices:

The chart above shows the negative free cash flow for 33 shale-weighted E&P companies.  Even at $100 oil prices in 2012 and 2013, these companies spent more money producing shale energy in the top four U.S. shale fields than they made from operations.  While costs to produce shale oil and gas came down in 2015 and 2016 (due to lower energy input prices), these companies still spent more money than they made.  As we can see, the Permian basin (in black) gets the first place award for losing the most money in the group.

Now, burning through investor money to produce low-quality, subpar oil is only part of the story.  The shale energy companies utilized another tactic to bring in additional funds from the POOR SLOBS in the retail investment community... it's called equity issuance.  This next chart reveals the annual equity issuance by the U.S. E&P companies:

According to the information in the chart, the U.S. E&P companies will have raised over $100 billion between 2012 and 2017 by issuing new stock to investors.  If we add up the funds borrowed by the U.S. E&P companies (negative free cash flow), plus the stock issuance, we have the following chart:

Thus, the U.S. E&P companies tapped into an additional $212 billion worth of funding over the last six years to produce uneconomical shale oil and gas.  Now, this chart is an approximation based on the negative free cash flow (RED color) from the four top U.S. shale fields and the shale equity issuance (OLIVE color).  So, how much money would these U.S. E&P companies need to make to pay back these funds?

Good question.  If we assume that the U.S. shale oil companies will be able to produce another 10 billion barrels of oil, they would need to make $21 a barrel profit to pay back that $212 billion.  However, they haven't made any profits in at least the past six years, so why would they make any profits in the next six years?

Okay, now that we understand that the U.S. shale industry has been burning through cash and issuing stock to continue an unprofitable business model, let's take it a step further.  If we understand that the U.S. shale energy industry is not making enough money from producing the oil and gas, then it also means that it takes more energy to produce it then we are getting from it.  Sounds strange... but true.

We must remember, investors, furnishing U.S. shale energy companies with funds are another way of providing ENERGY.  These U.S. shale energy companies are taking that extra $212 billion (2012-2017) and burning the energy equivalent to produce their oil and gas.  For example, it takes a lot more water to frack oil and gas wells.  To transport the water, we either do it by truck or by pipeline.  While this extra water usage is a Dollar Cost to the shale energy industry, it is really an ENERGY COST.  Think about all the energy it took to either transport the water by truck, or the energy it took to make the pipelines, install them and the energy to pump the water.

Moreover, if we add up all of the additional costs to produce U.S. shale oil and gas, the majority of it comes from burning energy, in one form or another.  Again, investor funds translate to burning energy.  Thus, the U.S. shale industry needs more energy to produce the oil and gas than we get from it in the first place.

Unfortunately, investors don't see it this way because they do not realize they will never receive their investment back.  It was spent and burned years ago to continue the Great U.S. Shale Energy Ponzi Scheme.

Let me put it in another way.  The U.S. and world economies are based on burning energy.  When we burn energy, we create economic activity and hopefully growth.  If the U.S. shale energy industry needed $212 billion more to produce the oil than they made from operations, then it means it burned more energy than it sent to the market.  Do you see that now??

So, the U.S. shale energy industry is STEALING & SWINDLING energy wherever it can to stay alive.  This is the perfect example of the Falling EROI (Energy Returned On Investment) forcing an industry to CANNABLIZE itself (and the public) to keep from going bankrupt.

Lastly, as time goes by the U.S. shale energy industry will behave like a BLACK HOLE, by sucking more and more energy in to produce even lower and lower quality oil and gas.  At some point, the shale energy industry will collapse upon itself leaving one hell of a mess behind.  While it's hard to predict the timing of the event, it will likely occur within the next 2-5 years.

Check back for new articles and updates at the SRSrocco Report. 

First published here: http://j.mp/2l7ezDm

It is clear stocks are in a massive bubble based on their Price to Sale (P/S valuation).

What about the economy?

Warren Buffett once famously stated that his favorite means of valuing stock was the stock market capitalization to GDP ratio.

Below is a chart for this metric. As you can see, the stock market today is as overvalued relative to the economy as it was at the peak of the 1999 Tech Mania.

So stocks are overvalued based on the most reliable corporate data point (revenues) and they are also overvalued relative to the economy. Scratch that, they’re not overvalued… they’re trading at 1999-Tech Bubble insanity levels.

We all remember what came after that...

What's coming will take time for this to unfold, but as I recently told clients of my Private Wealth Advisory report, we're currently in "late 2007" for the coming crisis. However, there is one main difference between 1999 and today...

Namely, that the Fed has been INTENTIONALLY creating bubbles for nearly 20 years today... and it's out of more senior asset classes to use!

Let me explain...

The late ‘90s was the Tech Bubble.

When that burst in the mid-‘00s, the Fed created a bubble in housing.

When that burst in ’08 the Fed created a bubble in US sovereign bonds or Treasuries.

And because these bonds are the bedrock of the US financial system, the “risk-free rate” of return against which ALL risk assets are valued, when the Fed did this it created a bubble in EVERYTHING (hence our coining of the term “The Everything Bubble” and our bestselling book by the same name).

On that note, we are putting together an Executive Summary outlining all of these issues as well as what’s to come when The Everything Bubble bursts.

It will be available exclusively to our clients. If you’d like to have a copy delivered to your inbox when it’s completed, you can join the wait-list here:

http://j.mp/2AkV1nF

Best Regards

Graham Summers

Chief Market Strategist

Phoenix Capital Research

First published here: http://j.mp/2lhkJ2W

CLICK ON CHART TO ENLARGE

 Some feel assets or charts have memories. If this is true, Tech bulls might be hoping that a certain level is forgotten!

The above chart looks at Tech ETF (XLK) on a monthly basis, since 1998. XLK peaked at the 2000 highs at (1), where a bearish reversal pattern (bearish wick) took place. This monthly pattern ended up being the monthly high before the ETF declined over 80%.

17-years later, XLK finds itself testing the 2000 highs again this month at (2). Tech bulls wish for the New Year… They want this level to be forgotten and see an upside breakout.

Tech bulls would get a caution message if selling pressure would start and support would give way at (2)!

 

Chart pattern analysis with brief commentary:   

There is a ton of news and opinions about markets and stocks that make the decision-making process more difficult than it needs to be.    

I believe the Power of the chart Pattern provides all you need to see what is taking place in an asset and determine the action to take.  

This approach has worked well for me and our clients and I encourage you to test it for yourself. 

 

Send an email if you would like to see sample research and take me up on a30 DAY FREE TEST DRIVE of our Premium or Weekly Research

where I provide actionable alerts on breakouts and reversals in broad market indices, sectors, commodities, the miners and select individual stocks  

Email [email protected]  

Call us Toll free 877-721-7217 international 714-941-9381 

 

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First published here: http://j.mp/2E0d5md

Gold, Bitcoin and the Blockchain Replaces the Banks - Realists Guide To The Future

- Futurist guide to 2028 shows a world of uncertainty and disruption
- One scenario suggests cybersecurity attacks will result in bitcoin and blockchain's dominance of financial systems
- Cybersecurity threat will still loom large and wreak havoc. Gold, silver and other real assets will benefit.
- Adoption of cryptocurrencies and blockchain will send gold price soaring
- Use of cryptocurrencies to take advantage of world systems will see investors turn to safe havens such as gold bullion and coins

The media is filled with predictions for 2018. Will Trump survive another year? How will Brexit negotiations play out? Can bitcoin recover from its recent fall? What fake news will create the next disruption to the apparent status quo?

No one knows the answers to any of theses questions. If the past year to eighteen months has taught us anything it is that the polls and predictions are almost a waste of time. Arguably it is better to look further into the future and at a range of scenarios so one can consider the opportunities and threats that may lie ahead.

Bloomberg has done just this, with their 'Pessimists Guide to 2028'. In it the authors consider eight scenarios. Each scenario could very easily begin to take place in 2018, but the full impact will play out over the following decade.

The scenarios put forth are:

Scenario 1
Trump wins second term

Scenario 2
Fake news kills Facebook

Scenario 3
Bitcoin replaces the banks

Scenario 4
North Korea launches an attack

Scenario 5
Corbyn makes socialism great again

Scenario 6
Generational Warfare Destroys Europe

Scenario 7
China begins a trade war

Scenario 8
Electric Cars end the oil era

Below we bring you the Scenario 3: Bitcoin replaces the banks

Each scenario is deserving of attention in its own right but it is the third one which we believe is the most pertinent and arguably realistic. This is the assumption that bitcoin will replace the banks and gold will benefit. Arguably gold would benefit as a result of many of the scenarios put forward. But, given the interest in bitcoin this year it is an important reminder that both bitcoin's growth and weaknesses will see gold and other real assets shine.

2018
A U.S. regional lender announces that its systems have been taken down in a cyberattack and all its deposits have vanished. Regulators around the world reassure account holders that their deposits are safe. Bitcoin jumps to $40,000 as deep fears set in about the safety of the financial system. Gold surges too, but by less.

2021
China’s Alibaba adopts its own cryptocurrency for use inside its vast e-commerce network, establishing the mass-market viability of digital money. Following Venezuela’s lead, Greece and a few African countries adopt bitcoin, which hits $100,000.

2023
Rogue coders inside a regulatory-compliance software company inject a Trojan malware program called Worm Hole into scores of banks around the world. Undetected, it siphons data and cash from accounts in fractional increments.
2026
A 10-year-old schoolgirl in Pittsburgh discovers Worm Hole and exposes it on social media, triggering a run on the global banking system. Shares in Old Wall Street crash as major central banks embrace blockchain technology, bypassing the banks, and issue digital money directly to households.
2028
Many commercial lenders break apart. The global financial system gives way to a fragmented patchwork of digital currencies and payment systems dominated by such players as Alipay and Amazon.com. Bitcoin hits $1 million.

In light of this scenario's end, Bloomberg offers Nightberg's advice for the investor:

Vanished bank deposits would likely drive a major disbelief in all things digital, even bitcoin. Owning real physical assets, such as gold, luxury real estate for high net worth individuals, artwork, and safety vault producers in general as individuals seek to store more of their wealth within their private residences. The cyber-insurance sector would benefit as the world would scramble to find a solution to decimated trust in the financial sector. Nightberg macro research.

Bloomberg's analysis and Nightberg's conclusion bring up a fear which is not just for the future but is a very real one today: cybersecurity attacks. the scenario begins because of a cybersecurity attack and it this issue is still not resolved ten years into the future.

Cyber attacks are not something which can be overcome by cybersecurity. Like any form of attack there will be new approaches and strategies. The year of 2017 has been a very serious wake-up call as to how cyber power can flip the status quo on its head. Consider the apparent meddling by Russia in Western politics or North Korea's (occasionally successful) attempts to steal bitcoin.

The invisible threat is very much on our doorstep.

This Christmas weekend HMS St Albans was forced to shadow a Russian warship in the North Sea. According to reports the warship was showing interest in 'areas of national interest'. What is there apart from oil? The UK's communication cables.

Air Chief Marshal Sir Stuart Peach, the chief of the UK's defence staff, has recently expressed concerns over the security of the cables. Should they be cut (or service disrupted) then the damage would "immediately and potentially catastrophically" hit the economy.

Prepare for uncertainty, not the rise of bitcoin 

This weekend's posturing by the Russians or Bloomberg's scenario planning should serve as a timely reminder as to what can and will survive such times. Physical gold cannot be made to disappear at the touch of a few buttons or by the cutting of cables.  Should there be a global cyberattack on the financial system, the primary wealth would no longer be primarily digital (bitcoin, cash, stocks and bonds etc).

Gold and silver allocated and segregated bullion is important because of both its tangible nature and its role as a safe haven in times of geopolitical upset. Bitcoin, or any other cryptocurrency, cannot be considered safe when cyberattacks are a daily reality. They are also new and still untrusted by the majority of the system.

When seeking to diversify your portfolio in order to protect from uncertain scenarios you should consider the risks posed to digital gold providers who do not allow clients to interact and trade on the phone and are solely reliant for pricing and liquidity from online portals and online trading platforms.

Those who have outright legal ownership of physical gold and silver coins and bars outside the banking system will be far better prepared for cybersecurity attacks and uncertain times.

You can read more on the other seven scenarios here. Whilst reading them it is worth reminding oneself of how easily the world can change and how uncertain we are as to whether they may or may not happen.

Related reading

http://j.mp/2pI3j5c...

http://j.mp/2pM14hk...

http://j.mp/2pI3lKm...

News and Commentary

Gold eases from 3-week top as dollar holds steady (Reuters.com)

Gold Miners ETFs Set to Bounce Back in 2018 (ETFTrends.com)

Bitcoin $1 million, Amazon $1 trillion: Bold calls of 2017 are worth watching now (MarketWatch.com)

Oil prices slip away from 2015 highs, but market remains tight (Reuters.com)

Apple and its suppliers weigh on Wall Street (Reuters.com)

Source: Bloomberg

First English gold coin worth just a penny will sell for unbelievable amount (Mirror.co.uk)

Sudan sharply devalues its pound against U.S. dollar (Xinhuanet.com)

Israeli regulator seeks to ban cryptocurrency firms from stock exchange (Reuters.com)

Let regions go bankrupt, Chinese central bank official says (Bloomberg.com)

World's Wealthiest Became $1 Trillion Richer in 2017 (Bloomberg.com)

Gold Prices (LBMA AM)

27 Dec: USD 1,285.40, GBP 958.78 & EUR 1,081.54 per ounce
22 Dec: USD 1,268.05, GBP 947.74 & EUR 1,069.85 per ounce
21 Dec: USD 1,265.85, GBP 945.97 & EUR 1,065.09 per ounce
20 Dec: USD 1,265.95, GBP 944.27 & EUR 1,068.21 per ounce
19 Dec: USD 1,263.10, GBP 944.93 & EUR 1,070.10 per ounce
18 Dec: USD 1,258.65, GBP 943.11 & EUR 1,067.71 per ounce
15 Dec: USD 1,257.25, GBP 937.41 & EUR 1,065.52 per ounce

Silver Prices (LBMA)

27 Dec: USD 16.50, GBP 12.30 & EUR 13.87 per ounce
22 Dec: USD 16.18, GBP 12.08 & EUR 13.65 per ounce
21 Dec: USD 16.15, GBP 12.08 & EUR 13.61 per ounce
20 Dec: USD 16.19, GBP 12.09 & EUR 13.67 per ounce
19 Dec: USD 16.16, GBP 12.08 & EUR 13.68 per ounce
18 Dec: USD 16.09, GBP 12.04 & EUR 13.64 per ounce
15 Dec: USD 15.99, GBP 11.93 & EUR 13.55 per ounce

Recent Market Updates

- Goldnomics Podcast – Gold, Stocks, Bitcoin in 2018. Everything Bubble Bursts?
- What Peak Gold, Interest Rates And Current Geopolitical Tensions Mean For Gold in 2018
- New Rules For Cross-Border Cash and Gold Bullion Movements
- ‘Gold Strengthens Public Confidence In The Central Bank’ – Bundesbank
- WGC: 2018 Set To Be A Positive Year For Price of Gold and Investors
- Year-end Rate Hike Once Again Proves To Be Launchpad For Gold Price
- UK Stagflation Risk As Inflation Hits 3.1% and House Prices Fall
- Buy Gold, Silver Time After Speculators Reduce Longs and Banks Reduce Shorts
- Bitcoin – Plan Your Exit Strategy Now – Maybe With Gold
- Gold Demand Increases Along with Uncertainty Thanks to Trump, Brexit and North Korea
- UK Pensions Risk – Time to Rebalance and Allocate to Cash and Gold
- Bailins Coming In EU – 114 Italian Banks Have NP Loans Exceeding Tangible Assets
- Silver’s Positive Fundamentals Due To Strong Demand In Key Growth Industries

First published here: http://j.mp/2pJSPSz

From the Slope of Hope: I saw a headline on December 24 which put a damper on my Christmas Eve:

Ummm - - so why on earth would this bug me? I don't have a dog in this fight. If Theranos goes bankrupt, it doesn't hurt or help me one bit. If they become the most valuable company in the world (ha!), the situation is the same. Utterly neutral and meaningless. So why should I care?

I've been pondering my reaction. Theranos is no stranger to the Slope of Hope, as I've written about this train wreck at length on eight separate occasions. For most of 2017, I wondered what had happened to them, because the media went completely silent on them. Ms. Holmes' own Twitter account hasn't issued a tweet for over two years (!), and every time I drive by the gorgeous Theranos headquarters here in Palo Alto, I see a completely empty parking lot. So I figured she basically got away with raising $900 million and having a ruined company without any consequence. But it seems I was wrong.

With the $100,000,000 that Fortress Investment is inexplicably throwing at Theranos, the company has now raised a billion bucks. I figure Holmes must have some SERIOUS dirt on somebody, because nothing about this makes any sense at all. Yes, yes, I realize her board of directors used to have every deep state slimeball imaginable, so maybe that helps, but let's face it, the Theranos name is mud. I would wager its brand has NEGATIVE value. If you were starting a brand new medical device company, and you could give it the Theranos name for, say, ten dollars, would you do it? Yeah, I didn't think so.

So, again, why should I care? Well, I think part of it is this:

Holmes' whole schtick was how she was the reincarnation of Steve Jobs. From the bizarre diet to the black turtlenecks to the secrecy ("Hey! Our stuff doesn't work at all! Shhhhhh! Don't say anything!"), she held herself out as a younger Steve Jobs who wore a B-cup. For a while, the media gobbled it up, and they actually put her on the front cover of national magazines, repeating the claim that she was worth $4.5 billion. She - - how shall I put this? - - wasn't.

I remain floored anyone would put another dime into this place. As the recent Wall Street Journal article mentioned, "An investigation by the Journal in October 2015 sparked a wave of scrutiny about Theranos' practices, at a time when the company had a valuation of around $10 billion. Holmes has continued to lead Theranos through settling multiple lawsuits. However, investigations opened by both the Justice Department and the Securities and Exchange Commission are ongoing." So they are tits-deep in lawsuits and angry shareholders, both Holmes and Theranos have been banned from running labs, and their name has become synonymous with smoke and mirrors. What's going on here? Just because you throw on a white lab coat doesn't make you a genius scientist.

Joking aside, I think for me what bugs the holy hell out of me is simply the disappointment. The past eight years have shown us an environment in which fraud, government bailouts, and crooked executives go unpunished, if not celebrated. Once in a blue moon, there's a piece of shit company which is finally exposed for what it is (other examples - - Color.com and Clinkle.com) and blow up in front of our eyes. We saw that with Theranos, and even though their success or failure doesn't affect my life one iota, it gave me some minuscule degree of satisfaction that there was still a little bit of judgment, discernment, and fairness to the world.

So when Theranos had an H-bomb dropped on them, and Holmes disappeared from the press, and their parking lot went empty, and their office space went up for least, I thought to myself: there's still a little bit of sense left out there. But I was wrong. There isn't. And if you're a mildly-attractive slender blonde with some razzle-dazzle and the right connections, you can get away with just about anything.

First published here: http://j.mp/2CbDGfJ

First Appearing on HedgeAccordingly.com

Fifth in a series.  Part 1, Part 2, Part 3, Part 4, Part 5

By @sellputs

Let us regard the wonders of technology & innovation: Suddenly, we now have multiple easy ways to lose money betting on bitcoin. Giddyup!

With incredible speed, from your laptop or even your smartphone and without even thinking about it, you can open up a new account, inject real U.S. dollars into it, use that to buy a teensy piece of your favorite cryptocurrency, and begin surfing the bitcoin wave. Or begin getting crushed by that wave, depending on your timing, smarts and luck.

This occurs to me on a recent Thursday night, as I visit an old friend in Brooklyn and bring along Big Guy, a college pal who stands 6-feet-4 (“and a half,” he feels it necessary to point out).  The Big Guy and I had been hanging out at the famed Waverly Inn in the West Village in Manhattan, where I had the vodka martini, marked down on special: just $28, down from $30 list.

This next point has nothing to do with bitcoin, okay? I gotta say: Anybody who regularly spends 30 bucks on a martini is a P.T. Barnum-scale sucker.  What a waste of money.  Waste it, instead, on something really irresponsible. . . . like bitcoin.

Anyway, we’re standing around a table in my friend’s apartment in Brooklyn, and Big Guy is taking swigs from a bottle of Blue Point Winter Ale and staring into the screen of his smartphone, as if mesmerized by some new videogame. Instead, he is tracking his own cryptocurrency trades.

“Uh oh, Ethereum is flash-crashing,” he says. He had gotten got into Ethereum (ETH), a newer “altcoin” alternative to bitcoin, a few days earlier at $620, watching it rise to $740 in a day or two and holding on, only to see it crash instantly down to $650 just this moment.  Should he sell?

Guy resists the urge and doubles up on his bet, adding to his ETH holdings (as well as Litecoin, LTC) “to lower my cost basis and scalp the bounce-back from the flash crash,” as he describes it later.  By 3 a.m. that same night, Ethereum had re-inflated to rise back up even higher, to $850. Whew.

Big Guy had put $10,000 into a new account he opened at Coinbase, a digital exchange akin to the New York Stock Exchange (except it is unregulated and carries no particular guarantees, far as I can see).  He had bet his stake all on bitcoin, pulling out after a 53% gain in a week, after commissions.

Guy opened up a second account, this one on GDAX, a 24/7, online platform in the rather unregulated, Wild West of crypto (it is owned by Coinbase). GDAX offers FDIC guarantees up to $250,000 (what happens to your money as a result of your trades is on you). On GDAX, he bet his bitcoin profits on the two lesser lights, ETH and LTC.  He says he can take profits out of Litecoin in only minutes, while transferring money out of bitcoin would take several hours. (LTC is lighter-traded than the binge-fueled bitcoin.)

GDAX charges him 25 basis points (0.25% of the total value of the trade) for “taking markets,” that is, buying coin shares on offer, and no fee at all for “making markets,” or selling on the platform.  Coinbase’s buying fee, at 1.5%, is fives times as much that of GDAX. A few days after he sat out the mini-flash-crash, Guy transfers some LTC from his GDAX account to another coin platform, Binance, where he wants to sell LTC and spread the proceeds among various coins trading below $5 apiece.

And a day or two after that, Big Guy is beaten down: He was up 75% and lost most of it all when he panicked and fled ETH and LTC at the bottom of a later plunge. Too fidgety. Easy come, easy go. He’s back in Ripple, though, and it has been “outperforming.”

Yes, the Big Guy admits, he does worry that in a flash crash or especially high trading volume, he may not be able to minimize his losses and take out cash.  In cryptocurrency trading, the bigger question than whether to sell may be: Can you sell? 

Coinbase limits how much money you can pull out of your account after you sell your crypto and convert the proceeds back to U.S dollars or whichever “real” currency you desire. So, in the event of a crash or some sudden, sharp de-valuation in bitcoins, your ability to act fast and sell your coins might be hampered, and selling your coins could be all but impossible.

Think of it as a football packed with cheering buyers, most of them unaware that there’s only one exit—and it is the size of a doggy door.  Buyer beware.  Puppies, too.

Next up: The high fees for buying bitcoin.

First published here: http://j.mp/2l0yMdY

Via The Daily Bell

In response to the tax bill which will lead to a lot more money in her pocket, Abigail Disney, heiress to the Walt Disney Company fortune, said she would be donating that tax break to a worthy cause of her choosing.

No, wait. That’s not it at all. She got in front of a camera and made a video complaining that other wealthy people and corporations won’t be forced to keep handing over quite as much of their money to the government now.

The video by Now This, which has 29 million views on Facebook as of today, features Disney trying to rile everyone up about how she and her private jet-owning friends will be taxed at a lower rate, how she can pass on assets tax-free to her children, and that health insurance won’t be forced on people when the individual mandate goes away in 2019.

“I know that we heard that the swamp was getting drained,” she says, “but given how this bill was written, I think it’s looking a lot like a nightmare from ‘Pirates of the Caribbean.’”

Even more telling than Disney’s cringe-worthy product placement jokes are the comments by viewers, arguing the merits or downsides of the particular tax plan, and engaging in ad hominem attacks, economic projections, and general complaints about “the wealthy.”

Sure, we could bicker about the exact way and amount we are taxed, picking apart the arguments Disney made in her video. For example, can she really say she is getting a “huge handout from Congress” if it was her money to begin with?

Can we conclude that “we know that wealth does not trickle down,” or should we ask one of the Walt Disney Company’s 195,000 employees, none of whom were earning a living off of Walt and Roy when the brothers were in “near-total poverty in the rural midwest”?

What exactly does Disney think is the right percentage to be taxed?

But these small details about who should owe what are exactly what the powers in government want us to be quibbling about. What Disney should actually be infuriated about, what she should “hope I’m making you angry” about, is that the ruling elite gets to make decisions about how her money is spent. They get to take it from the person who has it and use it in ways they see fit, to fund their pet projects, reward their donors, buy votes, and pad their wallets.

“No one who votes for this tax bill will be voting with your life in mind,” Disney said. “But you will pay for it.”

Well, that is one thing you got right, Ms. Disney.

The other thing that should just baffle and enrage us is Abigail Disney’s complete lack of confidence in her own ability to do good with her wealth. If she feels she does not deserve to hold on to her money, can’t she just donate that huge chunk of cash she “didn’t earn” instead of asking the government not to give it to her? Then the money would be going directly to the people or organization she felt deserved it the most, without going through the government bureaucracy: an incompetent middleman at best — and a bloated, corrupt, tyrant at worst.

In fact, in a great twist of irony, I have heard anecdotally of many individuals who plan to use their tax break to donate to their favorite liberal causes, a sort of middle finger to the GOP for . . . allowing individuals the financial autonomy to support organizations they deem worthy?

Wait, you mean the sky is not falling? Individuals with extra money in their pockets can voluntarily give it away to causes that are important to them without forcing their will onto the population as a whole? You sure showed those Republicans.

Even if Disney decided that straight-out charity wasn’t her thing, her investment of her “extra” money in real estate, another private jet — heck, even the world’s largest collection of Mickey Mouse bobbleheads — could only help the economy.

“More than anything, without a thriving and healthy middle class, there are no consumers for what Disney creates,” Disney laments, yet she can’t think of a single way the middle class might be helped except by rich people getting less of a tax cut.

Disney praises her grandfather and great-uncle Roy and Walt Disney for their “gumption, guts, and brilliance,” which ultimately led to a thriving company that is worth $92 billion today. People wait in line to see its movies, buy up its merchandise, and gladly pay exorbitant prices to visit the Happiest Place on Earth. But to hear her talk about “the 1 percent,” all the CEOs must just be greedy idiots when it comes to personal spending and could never use their business expertise to build up a nonprofit or finance a startup.

Meanwhile, Disney bemoans the United States’ “suffocating education system, a dying infrastructure, and a national debt that will be at least $1.5 trillion bigger.” But sure, let’s go ahead and give more money to a ruling elite that has been unable to keep the roads paved and the education system properly financed, all the while grossly overspending its budget and passing on its debt to future generations.

Guess what roads are always perfectly paved? The private ones leading into Disney World.

I wouldn’t put so much stock into what one misguided person with a soapbox has to say, except that her view is obviously echoed by so many. And it’s worse than not being an economically sound position. It’s a violent and immoral one too.

Because Disney, and others like her, are trying to frame themselves as the good guys, the ones looking out for the poor and weak in our society. But if that were the case, they would be content with giving away their own wealth and promoting worthy causes. Think of how many people she could influence with a Now This video aimed at feeding hungry children or providing low-cost health care to the destitute.

But that’s not good enough for her. It’s not good enough unless other people are forced, under violence or the threat of violence, to pay for the things that she thinks are the most important.

And judging by the general attitude of almost everyone I encounter in person or online, this is a pervasive idea: people must team up and force other people to do the right thing — the right thing as defined by their team.

Disney says in the video, “if democracy is just a bunch of people advocating for their own self-interest, instead of the interest of the greater good, then we’re not a democracy, we’re anarchy.”

She is using the words “democracy” and “anarchy,” but I do not think she knows what they mean. Democracy IS just a bunch of people advocating for their own self-interest. It is two wolves and a sheep voting on what to have for dinner. It is might makes right.

On the other hand, anarchy must look out for the interests of other people in order to coexist in society. Yes, each person can act in a self-interested way, but never to the point of coercion of another. There is nothing anarchical about using the government to force your will on others.

We have to turn the conversation away from the specifics of the tax bill and onto the elephant in the room: that most of the population approves of taking another person’s money at gunpoint in a manner and for an amount agreed upon by a majority. Filtered through government, most people are able to stomach this egregious act of violence.

That’s the real “Pirates” nightmare, Abigail.

First published here: http://j.mp/2Dg1xtR