Like waving a flag in front of a bull, May taunts the 1922 Committee. They have to change the rules to get rid of her.The Tory party has rules. The key rule at the moment is that a leadership challenge to remove a Prime Minister can happen only once in 365 days. Theresa May survived a leadership challenge in December of 2018.The “men in gray suits” comment is a reference to the 1922 committee.Although 80% of Tory MPs want May out, it’s the 1922 Committee that sets the rules. Yesterday, Sir Graham Brady, head of the rules committee issued an ultimatum: Pick Your Resignation Date or We Will.The committee cannot pick a resignation date, but it can change the rules and hold a leadership challenge vote.
May Taunts the Committee
Today

This is an open letter to Jerome Powell and the Fed. Dear Mr. Powell, In your March 8 speech on Normalization and the Road Ahead, you spoke of diversity, zero-bound interest rate problem, and the Fed’s path to normalization. You noted “Makeup strategies are probably the most prominent idea and deserve serious attention,” while simultaneously admitting …

US Cities are abandoning recycling efforts because it’s too costly. And China no longer accepts even our sorted garbage.The Wall Street Journal reports Aluminum Makers Ditch Can Business.Used cans are piling up at scrapyards because U.S. aluminum companies are turning fewer of them into new metal, another indication of the economic challenges facing recycling.Arconic Inc. and other aluminum rollers are producing less sheet for beverage cans and more higher-margin, flat-rolled aluminum for automotive and industrial components. Prices for used aluminum cans in the U.S. have fallen about 30% since last summer. Old cans are less versatile than other scrap. The makers of airplane and car parts prefer not to use aluminum made from

Rep. Alexandria Ocasio-Cortez (AOC) released her bill for a “Green New Deal”. It’s stunningly absurd.Today AOC released her New Green Deal Proposal. It’s a wish list of socialist and green ideas, most of which are obviously absurd to all but the most economically clueless persons. It has zero chance of passage and it’s nonbinding, but here are some of the key ideas.
Upgrade all existing buildings in the US
100% clean power
Support family farms
Universal access to healthy food
Zero-emission vehicle infrastructure
Remove greenhouse gasses form the atmosphere
Eliminate unfair competition
Affordable access to electricity
Create high-quality union jobs that pay prevailing wages
Guaranteeing a job with a family sustaining wage,

Miller, on verge of frothing at mouth over immigration, says Trump will “absolutely” shut down the government over Christmas unless he gets funding for the border wall. pic.twitter.com/gbNlNKSD7v
— Aaron Rupar (@atrupar) December 16, 2018

What to Expect
Here’s what to expect in a Government Shutdown.
The Postal Service is an independent agency, so it won’t be affected in any government shutdown.
Air-traffic controllers still will be on the job and customs and border agents will continue working at border crossings.
Amtrak, a government-owned corporation, also will operate as usual.
Those who want to go to national parks and federally operated museums could find popular places closed or hours curtailed.
The national zoos may close but the zoo’s animal caretakers

Every day, evidence mounts that Ford’s story is blatantly false. Perhaps she believes it, but that doesn’t make it true.Please consider Kavanaugh Will Use 1982 Calendar to Deny Sex Assault Claims.
Supreme Court nominee Brett Kavanaugh will turn over calendars to the Senate Judiciary Committee from 1982 that do not show him attending a high school party where Christine Blasey Ford said he sexually attacked her, according to a report on Sunday.
The calendars show that Kavanaugh, then a teenager, was out of town during most of that summer at the beach or with his parents, the New York Times reported, citing someone working on his confirmation hearings.
While at home in suburban Maryland, Kavanaugh’s calendar listed basketball games,

Before looking at the “Dilbert” method, please consider USA Today’s editorial Kavanaugh, too? Christine Blasey Ford’s account is missing key details of assault by Penny Nance.
Two decades ago, while pregnant with my first child, I was running in Northern Virginia when I was attacked by a man much larger and stronger than myself. I survived the attempted rape — but I’ll never forget it, in fact I remember every detail all these years later.
Twenty years after Bill Clinton — then the attorney general and highest ranking law enforcement officer in the state of Arkansas — allegedly raped Juanita Broaddrick, she remembered every detail as she told NBC’s Lisa Myers during a prime time interview. She even remembered Clinton biting her

The mass hysteria following Trump’s meeting with Putin is likely to last for days. Most are outraged. Few see the light.My article Congratulations to President Trump for an Excellent Summit with Putin spawned numerous some I could not tell if they were sarcastic or not.For example, reader Brian stated ” There is zero doubt now that Putin stole the election from Hillary. So much so that she MUST be given the nomination again in 2020. All potential challengers must step aside. To refuse her the 2020 nomination would be evidence of traitorous activities with Putin.”‘I congratulated Brian for brilliant sarcasm but he piled on. It now seems he was serious.
Mainstream media, the Left an the Right were in general condemnation.
Numerous cries of treason emerged from the

Chancellor Angela Merkel of Germany leaving a meeting of the Christian Democratic Union in Berlin early Monday. “We share a common goal in migration policy,” the party said in a statement. “We want to order, control and limit migration to Germany.”Say what?When did this become Germany’s goal? And what about refugee camps in Africa, with no African nation agreeing?The New York Times reports Merkel, to Survive, Agrees to Border Camps for Migrants.
Chancellor Angela Merkel, who staked her legacy on welcoming hundreds of thousands of migrants into Germany, agreed on Monday to build border camps for asylum seekers and to tighten the border with Austria in a political deal to save her government.
Although the move to appease the

The EU meets today in a futile attempt to solve a near impossible problem. A page from Trump’s playbook might help.Given the incessant bickering between EU countries over migration issues, it’s time to think outside the box. Here is the 5-Point Dilemma.
Germany Merkel’s CDU: Seek a consensus solution under existing EU rules.
Germany Seehofer’s CSU: Turn them back at the border (i.e. Send them back to Italy through Austria)
Italy Five Star and the League: Change the “Dublin Rules” which state migrants must apply for asylum in the first country in which they land. Italy wants to distribute existing migrants throughout EU. It also supports “safe areas” in Africa.
Czech Republic, Hungary, Poland and Slovakia: All refuse new migrants
Austria: Austria’s Prime Minister, Sebastian

Things are about to heat up in the EU. Italy’s ministers threaten the EU/EMU with mass deportations.Italy’s new leaders tell 500,000 immigrants: Pack Your Bags.
The right-wing Lega party, which formed a coalition government with Five-Star Movement (M5S) last week, is the driving force behind anti-immigration rhetoric and it is looking to fulfil a pledge to deport as many as 500,000 illegal migrants.
Lega leader Matteo Salvini — who is now Italy’s deputy prime minister and interior minister — reiterated the government’s aim to deport illegal migrants on a visit to Sicily last weekend.
On Saturday, speaking at a rally in northern Italy, Salvini had told illegal migrants “get ready to pack your bags.”
On Sunday, Salvini said the only way

New schools are popping up. Some offer one year programs but no college degree. Good idea?Ben Carlson at Wealth of Common Sense is irked by the question: Is College Worth the Cost?
Reddit co-founder Alexis Ohanian gave some advice to young people in a recent interview with the New York Times:
“Do you really need to go to college? There is a huge student loan debt problem in this country. I think there’s going to need to be a drastic change in how these universities work. And I also think we’ve lambasted the trades for way too long. You can make six figures as a welder.”
These kinds of statements irk me, especially when they come from rich entrepreneurs. This line of thinking reeks of survivorship bias.
Successful entrepreneurs must

Spanish prime minister Mariano Rajoy, the man who said there would not be a vote, now has to face the facts: 90% Voted for Independence.

📊 Resultats del Referèndum de #1OCT pic.twitter.com/2jGFL1xLz1
— Govern. Generalitat (@govern) October 1, 2017

90% of the 2.26 million Catalans who voted on Sunday voted in favour of independence, according to preliminary results released by the region’s government. The region has 5.3 million voters. Officials said 770,000 votes were lost due to disruption which resulted in polling stations being raided by Spanish police.
Carles Puigdemont, Catalan’s leader, announced in a televised statement that the region had earned the right to become an independent state and that results would be passed the region’s parliament in the coming days.

The Equifax security breach scandal keeps growing and growing. Their handling of the data breach that affected as many as 143 million accounts has been horrendous.
Executives dumped their shares before reporting the stolen data. Following the breach, their website did not function properly, people got signed up for programs they did not want or need, and customer service has been dismal all around.Equifax is Not Your Friend
InTheseTimes reports The Equifax Hacking Scandal Is a Reminder That Credit-Reporting Agencies Are Not Our Friends.
Last week, Equifax—one of the country’s three major credit-reporting agencies alongside Experian and Transunion—revealed that its security apparatus had been breached. “Hackers” obtained private financial

Indian banks are fearful of running out of cash as lines queue up to withdraw money.
Bankers say they cannot cope with any sudden increase in demand, and warn against lifting cash withdrawal limits.

A decision by New Delhi on November 8 to scrap all large-denomination banknotes overnight removed 86 per cent of India’s currency from circulation. In an effort to prevent banks running out of cash, the finance ministry then imposed strict limits on the amount of new notes that could be withdrawn. Customers can currently withdraw just Rs2,500 from an ATM per day — equivalent to $37 — or Rs24,000 over the counter per week.
Myths, Misunderstandings and Outright lies about owning Gold. Are you at risk?
“If the government lifts the limits on Friday and there is a sudden rush,

German media is solidly behind Angela Merkel as the US media was behind Hillary Clinton. German reporting of the recent terrorist truck incident was in a single word “pathetic”.
Thanks to chancellor Merkel, it’s politically incorrect to presume refugees are a problem. Worse yet, the media cooperates.
Culture of Denial
The following via email from Eurointelligence.
Why are the most advertised Gold and Silver coins NOT the best way to invest?
The discussion about the terror attack in Berlin has turned political very quickly, with some commentators now wondering openly whether this might cost Angela Merkel the elections.
This is at its most fundamental a story about denial. The German establishment, and their friends in the media, are in denial that Merkel’s

The eurozone cannot survive without Italy. The serious problem at the moment is the Eurozone also cannot survive with Italy.
Two of Italy’s three largest parties are anti-Euro. The only party in Italy that does support the euro is ex-prime minister Matteo Renzi’s Democratic Party. And with Renzi gone, there’s a huge risk the party splinters.
Regardless, there are no likely scenarios that can keep things from flying apart according to Wolfgang Münchau. I believe his analysis is solid.
Münchau makes a detailed case why the eurozone is doomed in Italy Poses a Huge Threat to the Euro and Union.
Myths, Misunderstandings and Outright lies about owning Gold. Are you at risk?
He lists five ways the Eurozone can stay intact. However, none of them stands up to close

Global financial repression picks up steam, led by India. After declaring large denomination notes illegal, India now targets gold.
It’s not just gold bars or bullion. The government has raided houses, no questions asked, confiscating jewelry.
For background to this article, please see my November 27 article Cash Chaos in India, 86% of Money in Circulation Withdrawn; Cash Still King in Japan.
Large denomination means 500-rupee ($7.30) and 1,000-rupee notes ($14.60), which account for more than 85 percent of the money supply. They are no longer legal tender, effective immediately.
As one might imagine, chaos ensued. And it continues.
Myths, Misunderstandings and Outright lies about owning Gold. Are you at risk?
India Confiscates Gold
Picking up where we left off, please

Personal income rose 0.2% in August, as economists expected. However, consumer spending rose 0.0% vs. the Econoday Consensus estimate of 0.2%.
The personal consumption expenditures (PCE) price index came in at +0.1% vs. a consensus of +0.2%. Last month the PCE was flat. This certainly is not what the Fed expected or wanted.
Year-over-year, PCE is up 1.0%, with the core PCE (excluding food and energy) up 1.7%.

Highlights
August was a soft month for the consumer, both for income and especially for spending. Income rose only 0.2 percent in the month as wages & salaries, which had been on a 4-month surge, could inch only 1 tenth higher in August. Consumer spending, which had also been on a 4-month winning streak, came in unchanged as durable goods declined, largely reflecting monthly weakness in vehicle sales, as did non-durable goods, in part reflecting low fuel prices. Service spending advanced, at plus 0.3 percent, but at a slower rate than prior months. Despite the weakness in income, the consumer put money into savings which are at a 5.7 percent rate for a 1 tenth gain and a special factor that held down spending.
Inflation readings do show more life with the PCE price index up 0.1 percent and the core up 0.2 percent, both 1 tenth better than the prior month. Year-on-year, the overall measure rose 2 tenths to 1.0 percent with the core up 1 tenth to 1.

Factory orders did way better than the Econoday consensus estimate of -1.9% but that was against a revision that took July from +4.4% to +3.6%. The good news pretty much stops there.
Highlights
The headline, at a monthly zero percent, is flat and so are the indications from the bulk of the August durable goods report. Excluding transportation, orders slipped 0.4 percent. This reading excludes a 22 percent downswing in civilian aircraft orders that is offset in part, however, by a solid 0.7 percent gain for vehicle orders. Readings on core capital goods (nondefense excluding aircraft) are mixed with orders up 0.6 percent, which points to shipment strength ahead, but current shipments are down -0.4 to extend a long string of declines going back to May. The weakness here in shipments is a negative for business investment in the GDP report.
Aside from vehicles and a strong gain for defense capital goods, good news is hard to find in today’s report. Total shipments are down 0.4 percent following no change in July while unfilled orders, which last posted a gain in April, fell 0.1 percent. Inventories did fall, down 0.1 percent, but not enough to keep the inventory-to-shipments ratio from rising to a less lean 1.66 from July’s 1.65.
Another negative in the report is a downward revision to July where the gain in total orders is shaved 8 tenths to 3.6 percent.

The €72 trillion (notional) derivatives mess known as Deutsche Bank remains under severe pressure. It’s market cap is $17.43 billion. It has no earnings and pays no dividend.
On April 23, Deutsche Bank was Fined $2.5 Billion over LIBOR rate rigging. Twenty-one people face criminal charges following a seven-year investigation.
On September 16, the US Department of Justice Fined Deutsche Bank $14B for mortgage securities fraud leading up to the 2007-2009 global meltdown.
Today, German Chancellor Angela Merkel Rules Out Assistance for Deutsche Bank.
No Comment
Chancellor Angela Merkel has ruled out any state assistance for Deutsche Bank AG in the year heading into the national election in September 2017, Focus magazine reported, citing unidentified government officials.
The German leader also declined to step into the Frankfurt-based bank’s legal imbroglio with the U.S. Justice Department, which may seek as much as $14 billion in sanctions against Deutsche Bank’s mortgage-backed securities business, the magazine said. A German government spokesman declined to comment on the report Saturday. A Deutsche Bank spokeswoman also wouldn’t comment.
Understanding the Fine
The Guardian reports $14bn Deutsche Bank Fine – All You Need to Know.
The prospect of a $14bn penalty from the US Department of Justice has rattled investor confidence in Deutsche.

UK prime minister Theresa May will address the UN General Assembly on Tuesday. She seeks UN Action to Control Mass Migration Flows.
In contrast, I propose a 10-point “common sense” solution, not UN action.
Let’s start with May’s proposal.
Theresa May will use her first appearance as British prime minister at a United Nations General Assembly meeting starting Monday to urge fellow leaders to do more to control mass migration, which she’ll argue hurts both refugees and the countries they enter.
May will say the migrants should be encouraged to claim asylum in the first safe country they reach.
Meanwhile the EU’s open internal borders have allowed large population flows, with many Eastern Europeans traveling to richer countries in search of a better life. It

Things are not going well for the Hillary campaign these days.
She is without a doubt sick, but no one knows what. Anyone trusting the pneumonia diagnosis as the full truth has mush for brains.
Her “deplorables” comment backfired miserably.
And today we learned that the Clinton campaign has been dinging donors multiple times for “one-time” donations.
Recurring “One Time” Donations
Please consider Hillary Clinton Campaign Systematically Overcharging Poorest Donors.
Hillary Clinton’s campaign is stealing from her poorest supporters by purposefully and repeatedly overcharging them after they make what’s supposed to be a one-time small donation through her official campaign website, multiple sources tell the Observer.
The overcharges are occurring so often that

A reader sent me an image of Hillary imposed with images of Peter Sellers from the movie Mysterious Doctor Strangelove.
I bit of digging turned up other interesting images and articles.
Hillary Strangelove

Origin is unknown, but a Boston Globe had an editorial back in 2008 with that same title: Hillary Strangelove
AMERICANS have learned to take with a grain of salt much of the rhetoric in a campaign like the current Democratic donnybrook between Hillary Clinton and Barack Obama. Still, there are some red lines that should never be crossed. Clinton did so Tuesday morning, the day of the Pennsylvania primary, when she told ABC’s “Good Morning America” that, if she were president, she would “totally obliterate” Iran if Iran attacked Israel.
This foolish and dangerous threat was muted in domestic media coverage. But it reverberated in headlines around the world.
Responding with understatement to a question in the British House of Lords, the foreign minister responsible for Asia, Lord Mark Malloch-Brown, said of Clinton’s implication of a mushroom cloud over Iran: “While it is reasonable to warn Iran of the consequences of it continuing to develop nuclear weapons and what those real consequences bring to its security, it is probably not prudent in today’s world to threaten to obliterate any other country and in many cases civilians resident in such a country.

On Sunday, an “Overheated” Hillary Stumbled or Fainted at a 911 Ceremony.
Hours later, came news flash Hillary’s Doctor Discloses Pneumonia Diagnosis Made Last Friday: Questions Abound.
Since then, a video by Dr Ted Noel has made the rounds. Dr Noel makes a seemingly convincing case Hillary has Late Stage Parkinson’s disease.
Snopes says Noel’s claim is false. I question the analysis of Snopes.
Some Mish readers who are medical doctors have some interesting comments.
Physical Gold & Silver in your IRA. Get the Facts. 
Late Stage Parkinson’s?
[embedded content]
In the above video, Dr Ted Noel makes a seemingly convincing case Hillary has Late Stage Parkinson’s disease.
My first thought on watching the video was “Wow”. My second thought was “Wow, I wish Dr

In the third poor economic report today, we learned industrial production declined 0.4% vs. an Econoday Consensus of -0.2%.
Diving into the Industrial Production and Capacity Utilization – G.17 Federal Reserve Report we also learned July was revised from +0.7 to +0.6 and manufacturing from +0.5 to +0.4%.
The standout pair of numbers is industrial production at -0.4% vs. motor vehicle production at +0.5%.
Highlights
There was some life in the factory sector during July but it proved brief, at least for production. Held down by a 0.4 percent decline in the manufacturing component, industrial production also fell 0.4 percent in data for August. But motor vehicles continue to be a plus in the report, rising 0.5 percent and offsetting a 0.5 percent decline in hi-tech production.
And mining is an increasing plus in the report, emerging from deep weakness with a second straight gain and a solid one at plus 1.0 percent. Utility production, which had up in prior months, fell back 1.4 percent in August. Total capacity utilization edged 4 tenths lower to 75.5 percent.
This report isn’t as weak as the headline readings suggest but, given weakness in other data including this morning’s Philly Fed and Empire State reports, won’t build much confidence that the factory sector will contribute much to the nation’s third-quarter growth.

David Stockman released his latest book “Trumped! A Nation on Brink of a Ruin” on Monday.
I read an advance copy last weekend.
I could not put the book down. It’s the book I wish I had written if only I had time.

Chapter 1 starts off with Stockman’s take on the revolt of Flyover America kindled by the Trump campaign. He mildly praises Trump with a bit of damnation thrown in, pretty much my position given the alternatives.
“Trumped!” is not really about Donald Trump, the man. Rather it’s about broken contracts and the conditions that led to the rise of Trump in the US, Brexit in the UK, and deteriorating economic conditions globally.
Politically speaking the book is anything but one-sided. Stockman goes after “feckless John Boehner” and his “equally spineless” replacement, Congressman Paul Ryan.
Stockman takes on the Fed and the ECB. The “Fed doesn’t serve the Main Street economy: It lives to pleasure Wall Street,” says Stockman, quite accurately.
In regards to Europe, Stockman states the “EU-18” owes Germany so much that permitting any country to leave is unthinkable in Berlin. The call for ‘more Europe,’ it is a desperate gambit to keep alive an utterly flawed and contradiction-ridden monetary, fiscal and political union that never should have been concocted in the first place.”
Stockman is a former Congressman and Ronald Reagan’s budget director.

Looking for group think, extrapolation of extreme silliness, linear thinking, and belief in absurd models?
Then look no further than Fed presidents, their advisors, and academia loaded charlatan professors.
Today’s spotlight is on Marvin Goodfriend, a former economist and policy advisor at the Federal Reserve’s Bank of Richmond, and Ken Rogoff, a chaired Harvard economics professor, a one-time chief economist at the International Monetary Fund.
Case for Minus 2% Rates
Goodfriend says the Fed Might Need to Cut Rates to Minus 2 Percent.
The U.S. Federal Reserve might need to cut interest rates to as low as negative 2 percent, far lower than levels other global central banks have tested, a former Fed economist said.
That’s what would likely be needed to engineer a recovery if the U.S. economy were to fall into a recession in the next couple of years, Marvin Goodfriend, who was an economist and policy advisor at the Federal Reserve’s Bank of Richmond from 1993-2005, told CNBC’s “Squawk Box” on Thursday.
Goodfriend, who is currently a professor of economics at Carnegie Mellon University, pointed to data on the eight recessions in the U.S. since 1960.
“In eight of those recessions, the Fed had to push the short rate 2.5 percentage points below the long term rate. Today, the 10-year rate in the U.S. is 1.

The economic data does not support a rate hike. Is the Fed is really worried about something else?
How about an overheating junk bond market? An equity bubble? Room to cut later? Or does the Fed really think the economy is strong?
Regardless, a massive selloff in bonds in Japan and a two-day five-sigma event in German bunds may be the start of a significant rout.
Let’s investigate this through the eyes of various bond market dislocations.
[embedded content]
Sizzling Hot
Bloomberg reports Red-Hot Market Spurs Risky Bonds That Allow Interest Delays.
The bond market is getting so hot that it’s fueling a surge in debt deals allowing companies to defer interest payments.
Just a week in, September is already on track to become the busiest month for so-called payment-in-kind toggle notes that let companies pay coupons with more debt, according to data compiled by Bloomberg. Ardagh Group SA, a Luxembourg-headquartered packaging company, sold $1.72 billion of the securities. German auto components maker Schaeffler AG is poised to sell 3.59 billion euros ($4.05 billion) of the notes on Thursday, more than 1 billion euros than initially planned, which would make it the largest PIK issue ever, Bloomberg data show.
PIK debt is often issued at the holding company level, which makes the notes riskier because they are one step removed from the operating company.

Fireworks are going off in Germany again in yet another battle between Wolfgang Schaeuble, Germany’s finance minister, and the ECB.
Schaueble dismissed a suggestion this week by ECB head Mario Draghi that Germany should use fiscal room for manoeuvre to decrease its export surplus.

Reuters reports Germany’s Schaeuble blames ECB for German Export Surplus.
Germany has no plans to reduce its export surplus, Finance Minister Wolfgang Schaeuble said on Friday, as the European Central Bank (ECB) has not changed its monetary policy which has led to a weaker euro which in turn boosts German exports.
“Even before the European Central Bank decided its policies of unusual monetary policy, which also led to the euro exchange rate falling significantly, I said that we will increase German export surplus,” Schaueble told reporters.
“If the surplus in the euro zone as a whole rises by a total of 3.6 percent, one should not be surprised that the German export surplus has also risen, if not by 3.6 percent but by 2 percent,” he said before meeting other European finance ministers.
When asked whether he had any plans to decrease Germany’s export surplus, Schaeuble said: “I haven’t heard that the ECB is changing its monetary policy.”
The Munich-based Ifo economic institute has said Germany’s current account surplus would probably hit a new record of 278 billion euros ($313.