War

Drums

Donald Trump Warns China on North Korea: ‘We Will No Longer Allow This to Continue’

“I am very disappointed in China. Our foolish past leaders have allowed them to make hundreds of billions of dollars a year in trade, yet they do NOTHING for us with North Korea, just talk,” Mr. Trump wrote in a pair of posts on his Twitter account. “We will no longer allow this to continue. China could easily solve this problem!” 

On Friday, North Korea test-fired a ballistic missile that experts said put the continental U.S. in range of a strike, illustrating rapid advancements in technology and intensifying Pyongyang’s standoff with Washington. 

Following the launch, Secretary of State Rex Tillerson urged world leaders to tighten United Nations sanctions on North Korea and singled out Russia and China for not doing enough to contain Pyongyang’s nuclear ambitions.

DYI:  North Korea to establish nuclear and multistage intercontinental ballistic missile system requires technical assistance they do not have the educational nor manufacturing infrastructure to achieve these successes.  Simply put, this 3^rd world police state is incapable of feeding their people or keeping the lights on do not have this capability.  Trump is correct China can stop this – North Korea is China’s client state – highly likely where the technical and manufacturing help is coming from.  Don’t bet on Russia for a second all of the trade and military agreements between the Motherland and Middle Kingdom is pure pragmatism.  At best of times these two cultures are economic competitors and worst outright adversaries extending back over 500 plus years.  Those missiles could very easily be re-targeted to strike Volgograd or Moscow at a moments notice.  This is further movement towards world war with the principal players lining up:

Allies:

U.S., U.K., NATO, India, South Korea, Japan, Russia, Iran – Christians, Hindus and Shiite Muslims.

Axis Powers:

China, Pakistan, Saudi Arabia, Egypt, Turkey, remaining Sunni Muslim countries – Buddhism and Sunni Muslims.

China is the hot head who believe that war is their destiny with the U.S. and her principal allies.

DYI

Maduro

The next

Stalin?

VENEZUELA LEADER: WILL USE NEW ASSEMBLY TO GO AFTER FOES

CARACAS, Venezuela (AP) -- President Nicolas Maduro is pledging to go after his political foes with the virtually unlimited powers of a constitutional assembly that his backers will select Sunday as his opponents wage a last-ditch battle to halt what they call the replacement of Venezuelan democracy with a single-party authoritarian system. 

Maduro indicated he is eager to prosecute many more members of the opposition parties that control a handful of state governments along with the National Assembly, providing one of the few remaining checks on the power of the socialist party that has ruled this OPEC nation for nearly two decades. 

"The right wing already has its prison cell waiting," the president said. "All the criminals will go to prison for the crimes they've committed."

DYI: 

If Maduro is able to secure his socialist/communist party nullifying any opposition what occurs next is the purging of the intelligencia class as their organizational skills pose a threat to his rule.  This will be accomplished by a creation of a police state to imprison and outright murder dissenters.  Many have already fled to other countries and if Maduro is successful the mass exodus will go into overdrive.

DYI

Coming

To

America Soon?

EU explores account freezes to prevent runs at failing banks

BRUSSELS (Reuters) - European Union states are considering measures which would allow them to temporarily stop people withdrawing money from their accounts to prevent bank runs, an EU document reviewed by Reuters revealed.

DYI:  You can be on it!  As long as the U.S. has the Federal Reserve – its private and there are NO reserves – stopping bank runs (remember it IS your money) we be paramount.  U.S. banks are now in far worse shape than ever before when a crises occurs this will be the Fed’s and Treasury’s rabbit out of hat trick in order to bail out the banks. 

DYI

Video:

Satirical Expose

Of

Venezuela’s Socialism 

Venezuela: A Tour of Lolcow Country

DYI

$hit

Hit the Fan?

China’s Inverted Yield Curve 

On June 7th the spread between China’s 10 and 1 year Sovereign bond yields became negative. This was only the second time since 2005 that such an inversion occurred, and this time around it became the most inverted in history. 

An inverted yield curve, no matter what country it occurs in, is a sign of severe distress in the banking system and almost always presages a recession. 

A recession, or even just a sharp decline in China’s GDP growth, would send shock waves throughout emerging markets and the global economy. Indeed, on July 17th the major indexes in China all plunged the most since December 2016 due to investor fears over tighter monetary and economic controls from Beijing. 

If the yield curve remains inverted into the fall, look for exacerbated moves to the downside in global markets.

 DYI

The

Red Menace

Infiltrates American

Cultural, Civic and Judicial Institutions.

1.     Politicians

2.     Main Stream Press

3.     Police administrators

4.     Professors and public school educators

5.     Prosecutors

6.     Pastors – Preachers – Priests – Rabbis

7.     Hollywood

Thus is the case with communism/socialism/Marxism in the United States. While the average American rightly shows no tolerance for neo-Nazis or skinheads, Marxists are a different story.  Once upon a time in America, a declared Marxist was a pariah in his community.  After years of favorable treatment by the media, academia, and Hollywood — entities that have suppressed the truth about the communist holocaust of a hundred million innocents, the destruction of economies and squelching of man’s spirit — people have to scratch their heads choosing between  Marxism or liberty libertarian ideals???

DYI

 Liberal & Conservative

Make America Great!

The marriage between government and industry makes voting at the ballot box or with your dollar a dubious solution.

 But the smaller and more decentralized institutions get–whether business or government structures

the easier they are to control.

How Decentralizing Institutions Will Unite the Left and Right

By Joe Jarvis - July 26, 2017

“Big government is the problem!” 

“No, big business is the problem!” 

What if their coexistence on such a large scale is the real problem? They each rely on the other for power. A corporation is a government creation, with legal definitions which protect it from market forces. And government laws and regulations are largely designed by corporate special interests. 

It is a vicious cycle which arguably fits the definition of fascism. The government doesn’t own the means of production, but it regulates industry to the point that it might as well. A corporation can work through the government to make any law or regulation it wants which will give them an unfair advantage or kill a competitor. The government even directly hands corporations money in the form of bailouts, subsidies, and grants! 

At this point, it is impossible to disentangle big business and big government. So when we talk decentralizing institutions, it is not just the government which needs to be split up. 

Of course, many on the left seem to think the government is the institution needed to reign in big business. 

This is an absurd contradiction; government is what made big business the cronyistic monster it is today. 

Likewise, we cannot expect the market to reign in government. Current market conditions prove the easiest way to turn a “profit” is by cozying up to the government, not by pitting your business against it.

 Make America Great

9

Sisters

Of

Institutional Change

1.)   End the Federal Reserve

2.)   Repeal 17^th Amendment – Reinstate Federal Senators chosen by State Legislators.

1. Term Limits – Constitutional Amendment

A. Two six year terms for Senators

B. Three terms House of Representatives

3.)   Repeal 16^th Amendment – Income tax replace with value added tax.

4.)   Pass the Balanced Budget Amendment

5.)   Exit the United Nations

6.)   Reign in the Medical Industrial Complex

a. Enforce Anti-Trust Laws

b. Pass Legislation for re-importation of ethical drugs

7.)   End Federal and Private Student Loans
8.) Trust Bust Monopolies
9.) Reduce & decentralize significantly the Federal Government  

DYI

Home Run

Hitter

Walter Williams

WESTERN VALUES ARE SUPERIOR

The idea of the sacredness of the individual is rare in human history -- and worth defending.

Intellectual elites argue that different cultures and their values are morally equivalent. That's ludicrous. Western culture and values are superior to all others. I have a few questions for those who'd claim that such a statement is untrue or smacks of racism and Eurocentrism. Is forcible female genital mutilation, as practiced in nearly 30 sub-Saharan African and Middle Eastern countries, a morally equivalent cultural value?

 

Slavery is practiced in Mauritania, Mali, Niger, Chad and Sudan; is it morally equivalent?

In most of the Middle East, there are numerous limitations placed on women, such as prohibitions on driving, employment and education. Under Islamic law, in some countries, female adulterers face death by stoning. Thieves face the punishment of having their hands severed. Homosexuality is a crime punishable by death in some countries. Are these cultural values morally equivalent, superior or inferior to Western values?

My colleague Dr. Thomas Sowell reveals some of the problem. He says, "Those in the Islamic world have for centuries been taught to regard themselves as far superior to the 'infidels' of the West, while everything they see with their own eyes now tells them otherwise." Sowell adds, "Nowhere have whole peoples seen their situation reversed more visibly or more painfully than the peoples of the Islamic world." 

Few people, such as Persians and Arabs, once at the top of civilization, accept their reversals of fortune gracefully. Moreover, they don't blame themselves and their culture. They blame the West.

By the way, one need not be a Westerner to hold Western values. One just has to accept the sanctity of the individual above all else.

DYI

%

Allocation Formula

7-26-17
Updated Monthly

% Allocation = 100 – [100 x (Current PE10 – Avg. PE10 / 2)  /  (Avg.PE10 x 2 – Avg. PE10 / 2)]

Current PE10.....30.30

Avg. PE10.........16.77

% Stock Allocation 13% 

Logic behind this approach:

--As the stock market becomes more expensive, a conservative investor's stock allocation should go down. The rationale recognizes the reduced expected future returns for stocks, and the increasing risk. 

--The formula acknowledges the increased likelihood of the market falling from current levels based on historical valuation levels and regression to the median, rather than from volatility. Many agree this is the key to value investing.  

Please note there is controversy regarding the divisor (Avg. PE10).  The average since 1881 as reported by Multpl.com is 16.70.  However, Larry Swedroe and others believe that using a revised Shiller P/E mean of 19.6 , the number since 1960 ( a 53-year period), reflects more modern accounting procedures.

DYI adheres to the long view where over time the legacy (prior 1959) values will be absorbed into the average.  Also it can be said with just as much vigor the last 20 years corporate America has been noted for accounting irregularities.  So....If you use the higher or lower number, or average them, you'll be within the guide posts of value.      

  

DYI

This blog site is not a registered financial advisor, broker or securities dealer and The Dividend Yield Investor is not responsible for what you do with your money.

This site strives for the highest standards of accuracy; however ERRORS AND OMISSIONS ARE ACCEPTED!

The Dividend Yield Investor is a blog site for entertainment and educational purposes ONLY.

The Dividend Yield Investor shall not be held liable for any loss and/or damages from the information herein.

Use this site at your own risk.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

The Formula.

A value based allocation strategy

February 19, 2010 by John Kingham

Bubble

News

A Mystery Investor Has Made A 262 Million Dollar Bet That The Stock Market Will Crash By October

 By Michael Snyder, on July 23rd, 2017

One mystery trader has made an extremely large bet that the stock market is going to crash by October, and if he is right he could potentially make up to 262 million dollars on the deal.  Fortunes were made and lost during the great financial crisis of 2008, and the same thing will happen again the next time we see a major stock market crash.  But will that stock market crash take place before 2017 is over?  Without a doubt, we are in the midst of one of the largest stock market bubbles in U.S. history, and many prominent investors are loudly warning of an imminent stock market collapse.  It doesn’t take a genius to see that this stock market bubble is going to end very badly just like all of the other stock market bubbles throughout history have, but if you could know the precise timing that it will end you could set yourself up financially for the rest of your life.

The Elites Are Privately Warning About a Crash

What the elites rely on is not secrecy but lack of proficiency by the media. 

The elites communicate in an intentionally boring style with lots of technical jargon and publish in channels non-experts have never heard of and are unlikely to find. In effect, the elites are communicating with each other in their own language and hoping that no one else notices

DYI

Detroit Is Demolishing Homes With Federal Money Meant "To Save Them"

Instead, Michigan and several other states’ decision to use the money for demolitions has come under fire because the federal government created no rules or controls to prevent fraud, waste, and abuse, according to a 2016 SIGTARP investigation. 

Their negligence allowed the program to be riddled with waste and fraud, as contractors started raising their bids, and the bidding process for demolitions has become rife with bid-rigging and other tactics for fraud and abuse that were once famously associated with the American mafia. Soaring demolition costs in the state caught the attention of federal investigators, and now the Detroit Land Bank's handling of the demolitions has become the subject of an ongoing federal grand jury investigation.

DYI:

Despite the obvious abhorrent over spending on demolitions I agree with Detroit and the State of Michigan the number one goal is the removal of urban blight.  These abandoned derelict homes and business is an eye sore and draws in the criminal element that Detroit sorely needs to reduce. The time has long since past (since the late 90’s) to restore these homes or business’.  Many have been abandoned for 20, 30, even 40 years with no hope of repair.  Here is a link to a YouTube video, it speaks for itself and this one.   

DYI 

Ron Paul

At His Best!

Ron Paul Explains the Libertarian Option on Larry King’s Politicking

Host Larry King engages libertarian communicator Ron Paul in a wide-ranging discussion of current issues in a new episode of King’s Ora TV show Politicking. In the interview that starts with a discussion of foreign policy and moves on to domestic issues including healthcare, Paul presents libertarian proposals across the board. The 26-minute interview provides a good exploration of Paul’s ideas, with King asking thoughtful questions and then giving Paul plenty of time to discuss the details.

 DYI

CNN’s

American

Boris & Natasha

Comedy Show

CNN Readies Russophobic Show To Scare Suburbia

So it’s unsurprising that CNN, in a seemingly blatant example of suburban scaremongering, will attempt to revive the anti-Russia hysteria that permeated the political climate just a few months ago, by preparing to debut “The Spies Next Door: Operation Ghost Stories." The documentary focuses on the story of undercover Russian sleeper living in the US. The show details “one of the largest counterintelligence investigations in the history of the FBI,"reads a release from the network via the Hill. 

The series airs Saturday nights at 9:00 pm EST and is hosted by former Republican Rep. Mike Rogers. Rogers was, until recently, a contender to succeed James Comey as FBI director.

Syria Gas Attack and Russian Election Hacking...Debunking Fake News With Scott Ritter

Former Marine intelligence officer and UN Chief Weapons Inspector for Iraq, Scott Ritter, joins the Ron Paul Liberty Report today to shed light on the phony "17 intelligence agencies agree on Russian election hacking" story and to explain why in his vast intelligence and WMD experience why the UN "investigation" into the April "sarin gas" attack in Syria was deeply flawed and should not be believed. Also don't miss Ritter's fascinating explanation of the real purpose of the so-called "White Helmets" in Syria!

 DYI: Excellent Video from Ron Paul.

 DYI

CIA

Mafia America?

CIA Chief: WikiLeaks Will Take Down America Any Way They Can

CIA Director Mike Pompeo remains inconsolably hostile toward whistleblower organization WikiLekas, insisting they are a “non-state hostile intelligence service” and are plotting to “take down America any way they can and find any willing partner to achieve that end.” 

Hostility to WikiLeaks has been a mainstay in the US government, as every administration faces the prospect of their covert misdeeds becoming a matter of public record, to their general embarrassment albeit rarely to the end of any meaningful reform.

DYI: 

Misdeeds!? The CIA is afraid the American public may awaken completely putting pressure on the political elites to prosecute their crimes operatives have committed routinely.  If Wikileaks lets loose with everything it has it’s been said the America public would go into shock as to the level of mafia type of control over America.  If that happens when the public comes out of shock hopefully they will become enraged demanding prosecutions and the spy organization reduced in size by 80%.  That is what they fear.   

DYI

Market

Insanity!

July 24, 2017

Salient Features of Bull Market Peaks

John P. Hussman, Ph.D.

Last week, the S&P 500 price/revenue ratio reached the highest level in history, outside of the single week of March 24, 2000 that represented the peak of the tech bubble. Meanwhile, the 30-day CBOE volatility index (largely reflecting the level of fear or complacency among option traders) dropped to a record low, as bullish sentiment surged to 57.8% bulls versus 16.7% bears (Investors Intelligence), and the S&P 500 pierced its upper Bollinger bands (two standard deviations above a 20-period moving average) on daily, weekly, and monthly resolutions.

On the measures we find most tightly correlated with actual subsequent market returns across history (see the table in Exhaustion Gaps and the Fear of Missing Out for a comparison of the reliability of numerous alternative measures), the S&P 500 is now between 150% and 170% above valuation norms that have been approached or breached over the completion of every market cycle in history, including the most recent one. Allowing for a lesser retreat ending about 25% above those norms (which is the largest distance ever remaining by the completion of any cycle across history, even those associated with quite low interest rates),

we fully expect the S&P 500 Index to lose between 50-63% as this speculative episode unwinds.

On that note, it’s worth noting that the Shiller CAPE reached 30 last week, which places current valuations among the highest 3% of historical observations, on that particular measure.

In reality, however, the situation is much more extreme.

Put another way, investors are currently paying a very high multiple of a very high earnings number that quietly benefits from cyclically elevated profit margins. 

On the basis of normalized profit margins (an adjustment that improves historical reliability), 

the normalized CAPE would presently 

be 

 40.

While some observers take solace in the fact that the CAPE reached a much higher level of 44 at the 2000 bubble peak, that historical comparison ignores the embedded margin. See, at the 2000 peak, the embedded margin of the CAPE was just 5.1%, compared with a historical norm of 5.4%. At present, because of depressed wages and high profit margins in recent years (which are now reversing given a 4.4% unemployment rate), the CAPE quietly embeds a profit margin of 7.2%.

There is only a single week in history where the normalized CAPE was higher. That was the week of March 24, 2000, when the S&P 500 hit its final bubble peak, at a normalized CAPE of 41.

 DYI: 

At 40 times Shiller PE¹⁰ stocks purchased or held go to sleep like Rip Van Winkle waking 15 years from now the estimated average annual nominal return is….Drum Roll Please….0.68%!  The yield for Vanguard’s Vanguard Intermediate-Term Investment-Grade Fund Investor Shares (VFICX) is 2.60% a clear winner over stocks for the next 15 years no matter which way interest rates zig and zag.

The 10 year holding period stocks are slated to deliver a negative average annual return of….-2.29%!  Suffice to say short, intermediate or long term high grade bonds will out perform stocks over the next 10 years.  So hold onto your hats and your cash better value are ahead!

DYI