Mohacsy's Safe Portfolio Member Forum

[10nisman]

It's so reassuring to see you're still lemony. Never change.

A simple thank you for correcting your nonsensical post would have sufficed. Grow up, old man.

[Elroy Jetson]

President Biden and House Speaker Kevin McCarthy (R-Calif.) have reached an “agreement in principle” to raise the debt ceiling and reduce federal spending.

Now Kevin merely has to find the magical powers needed to obtain a majority of Congressional House members to vote for the agreement he has negotiated.

Conservatives on Saturday appeared on the verge of revolt as McCarthy failed to meet all of their many demands.

During the previous House-led hostage crisis in 2011 the US Treasury did not default, but the debate alone still sank the stock market and brought about a rare downgrade in U.S. credit, raising the risk that hard-fringe Republicans’ renewed sense of brinkmanship will still carry its own economic consequences.


The agreement will reportedly keep spending “roughly flat” at federal health, education, science, labor and other domestic agencies, which would see a 1 percent increase in 2025.

McCarthy rejected any repeal of Trump's signature tax cuts which created much of the new debt but instead agreed to offset Republican demands for 50% budget cuts by redirecting money set aside to help the IRS pursue unpaid taxes, which Republicans long have opposed as an infringement of their personal financial freedom.

[Elroy Jetson]

It's so reassuring to see you're still lemony.

Never change.

[10nisman]

Apparently Kohl's has found a way to make a small profit. They're up 16% today on earnings of 13 cents a share. Let me do the math; that's 52 cents a year on a share price of $22.28 or 43X earnings. Hum, KSS at 43X earnings or MSFT at 34X earnings. Now there's a difficult choice..:).

First, annualizing a retailers 1st quarter earnings is beyond insane. Kohl's earnings estimate for the year is almost $3/share (vs. your 52 cents). Second, comparing Kohl's to MSFT is completely absurd.

[jbsliverer]

Insurance giant halts sale of new home policies in California due to wildfires
State Farm also cites inflation of construction costs in statement which comes after increasing wildfires in state
https://www.theguardian.com/us-news/2023/may/27/state-farm-home-insurance-california-wildfires

Gloria Oladipo
@gaoladipo
Sat 27 May 2023 11.18 EDT

California saw 7,490 wildfires in 2022, an increase from the previous year. Photograph: David McNew/Getty Images

The insurance giant State Farm, America’s biggest car and home insurer by premium volume, will halt the sale of new home insurance policies in California, citing wildfire risk and inflation of construction costs.

Starting on Saturday, the company will not accept insurance applications for business and personal lines property and casualty insurance. The company will still accept auto insurance applicants.

“State Farm General Insurance Company made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market,” the company said in a statement.

“We take seriously our responsibility to manage risk. We recognize the governor’s administration, legislators and the California department of insurance (CDI) for their wildfire loss mitigation efforts. We pledge to work constructively with the CDI and policymakers to help build market capacity in California. However, it’s necessary to take these actions now to improve the company’s financial strength.”

Existing customers insured by State Farm will not be impacted by the decision.

In response to State Farm’s statement, a spokesperson with the California department of insurance told Fox Business News that it is working to protect homeowners.

“The factors driving State Farm’s decision are beyond our control, including climate change, reinsurance costs affecting the entire insurance industry and global inflation,” said the spokesperson.

State Farm is not the only insurance company to disrupt coverage over wildfires. American International Group, a multinational insurance company, notified thousands of California homeowners last year that their policies would not be renewed, the Wall Street Journal reported.

The latest statement from State Farm comes after a bout of wildfires in California last year. While wildfires arenot rare in the western parts of the US, the climate crisis has exacerbated the issue, especially in California.

California saw 7,490 wildfires in 2022, an increase from the previous year, according to data from the California government. One wildfire in northern California destroyed 100 homes and other buildings, reported NBC News.

The severity of wildfires has destroyed homes, caused injuries and deaths, and worsened air quality, exposing millions to smoke and ash.

California’s climates have become warmer and drier due to the climate crisis, causing the state’s wildfires to be more frequent and intense. A recent study found that between 1986 to 2021, almost 40% of forest area that burned in the western US and parts of Canada could be attributed to fossil fuels, the Washington Post reported.

Moreover, California has experienced record wildfires in the past six years. The state experienced eight of the largest fires in US history and three of the top five deadliest fires.

[Elroy Jetson]

Seniors are flooding homeless shelters that can’t care for them - https://www.washingtonpost.com/business/2023/05/22/seniors-homeless-baby-boomers/

Cities are building special shelters for the old, and shelters are hiring trained staff to handle a wave of aging baby boomers

PHOENIX — Beatrice Herron, 73, clutched a flier offering low-cost cable TV, imagining herself in an apartment, somewhere out of the Arizona heat where, like others her age, she could settle into an armchair and tune in to a television of her own.

Instead, the grandmother and former autoworker can be found most mornings in a food line, or seeking shade under the awning of a mobile street clinic. At night, she sleeps on a floor mat at a homeless shelter. She laments the odors of human waste outside and the thieves who have victimized her repeatedly.

“My wallet’s gone,” she said. “My purse was stolen.”

She hardly stands out from the dozens of seniors using wheelchairs and walkers at a complex of homeless shelters near downtown Phoenix, or from the white-haired denizens of tents in the surrounding streets — a testament to a demographic surge that is overwhelming America’s social safety net.

Nearly a quarter of a million people 55 or older are estimated by the government to have been homeless in the United States during at least part of 2019, the most recent reliable federal count available. They represent a particularly vulnerable segment of the 70 million Americans born after World War II known as the baby boom generation, the youngest of whom turn 59 this year.

Advocates for homeless people in many big cities say they have seen a spike in the number of elderly homeless individuals, who have unique health and housing needs. Some communities, including Phoenix and Orange County in California, are racing to come up with novel solutions, including establishing senior shelters and hiring specially trained staff.

“It’s just a catastrophe. This is the fastest-growing group of people who are homeless,” said Margot Kushel, a professor of medicine and a vulnerable populations researcher at the University of California at San Francisco.

The largest shelter provider in Arizona, Central Arizona Shelter Services (CASS), is rushing to open an over-55 shelter in a former Phoenix hotel this summer with private rooms and medical and social services tailored for older people. The facility will open with 40 beds and eventually reach a capacity of 170, but that will barely begin to address the problem of keeping older people safe and healthy. CASS says it served 1,717 older adults in 2022, an increase in one year of 43 percent.

Part of "The Zone" in Phoenix


In Orange County, a Medicaid plan is creating a 119-bed, first-of-its-kind unit that essentially will serve as an assisted-living facility exclusively for homeless people, said Kelly Bruno-Nelson, executive director for the plan, CalOptima Health.

“The current shelter system cannot accommodate the physical needs of this population,” she said.

In San Francisco, Portland, Ore., and Anchorage, seniors also are staying for months in respite centers that were meant to provide a short-term stay for homeless people to recuperate. In Boise, shelter operators are hiring staff with backgrounds in long-term care to help homeless clients manage their daily needs while living for long stretches in hotels.

The homeless population is famously difficult to count. People 55 and older represented 16.5 percent of America’s homeless population of 1.45 million in 2019, according to the most recent reliable data. Dennis Culhane, a professor and social science researcher at the University of Pennsylvania, said the population of homeless seniors 65 and older will double or even triple 2017 levels in some places before peaking around 2030.

“It’s in crisis proportions. It’s in your face,” Culhane said. “Average citizens can see people in wheelchairs, people in walkers, people with incontinence and colostomy bags making their living out of a tent.”

A devastating combination of factors is to blame for the rising problem. People in the second half of the baby boom, who came of age during recessions in the 1970s and 1980s, face distinct economic disadvantages, Culhane said. Housing costs are soaring in many cities. The nation’s system of nursing homes and assisted-living facilities is not equipped to handle the needs of homeless people, who suffer from high rates of substance abuse and mental illness.

Before Phoenix officials began clearing some streets of people this month, there were about 900 people living in a few square blocks known as “The Zone” and another 900 or so living in emergency shelters on the gated Human Services Campus in the same neighborhood, shelter operators said.

In Maricopa County, which encompasses the Phoenix metro area, an annual count in January documented more than 2,000 homeless people 55 and above, and nearly a third of those were 65 or older.

Living on the street ravages the human body, street doctors and advocates say. Homeless people contract chronic diseases and other geriatric problems much earlier than average. But long waits for housing and a lack of specialized care expose them to a continued onslaught on their health.

After providing treatment for acute illnesses, hospitals often discharge homeless patients, who wind up back in shelters or even back in their sidewalk tents and makeshift lean-tos, in what health practitioners in Phoenix ruefully call “treat-and-street.”

The threat of relapses and rehospitalizations is large. Aid workers said seniors’ medicine is often stolen by younger homeless people on the streets. It is not unusual to assist clients with dementia.

Staff at CASS pass out adult diapers. Some unhoused seniors remain at the CASS shelter for a year or more while they await placement in subsidized housing, assisted living or a nursing home. But CASS is not licensed to provide nursing-home-level care, and staff are not trained as nursing assistants. So patients cannot remain if they have advanced geriatric care needs and require help with activities of daily living such as dressing, eating and going to the bathroom.

“They need a higher level of care than the current shelter system can provide,” said Lisa Glow, chief executive of CASS. “There have been times here where we had to turn people away, where it’s really heartbreaking. They come in a wheelchair, late at night, and they can’t take care of themselves.”

In those instances, staff work to get an alternative space as quickly as possible, such as a hotel, she said.

In Phoenix, summer heat is on the way, which poses a particularly grave threat of dehydration, heat stroke, and burns from bare feet, arms and legs coming into contact with blisteringly hot concrete and asphalt.

“Quite a lot of our patients have mobility issues,” said Mark Bueno, a primary care doctor who treats patients living on the streets from a mobile clinic run by Circle the City, a local homeless aid group. “I have patients in their 80s out here.”

In years of researching homelessness, Kushel has catalogued the countless paths to sudden homelessness for older adults. It often involves the death of a spouse or parent, which means income is lost and rent or a mortgage can no longer be paid, she said.

Other long-term chronically homeless people are simply aging on the street.

Medicaid, the health insurance program for the poor, will only pay for a long-term nursing home or assisted-living bed if someone is unable to care for themselves. Many elderly homeless people are not debilitated enough to meet that criteria.

“That’s where the gap in the system is,” said Regan Smith, long-term care ombudsman program director in Maricopa County.

A pinball effect takes hold, said health-care providers, shelter operators and advocates. Homeless people bounce from homeless shelter to hospital, then to a nursing home for a short-term recuperation stay. Once that short-term stay ends, nursing homes must decide whether the person is infirm enough to qualify for long-term care. If the answer is no, they must leave the nursing home, starting the cycle over again.

In New Mexico, 69-year-old Steven Block, who has memory problems, ended up homeless in the lobby of a Coyote South hotel in Santa Fe this year after being evicted from a nursing home in Taos, Block’s family members said.

Block, a former reporter for a community newspaper in southern Colorado, abused alcohol and suffered a fall near his home in Raton, N.M., said Terrie Gulden, his brother-in-law. He suffered hip and shoulder fractures and was treated in an Albuquerque hospital, where doctors discovered he had dementia, Gulden said. He was transferred to the Taos facility in June 2022 but was discharged with no notification to the family on the last day of January, Gulden said. Block, who had some socks and a change of underwear in a garbage bag, was unable to tell his family how he ended up in Santa Fe.

“I had no idea that was happening until I got a call from a Santa Fe hotel that he was in their lobby. He had no money, no papers, no discharge papers. He was just out on the street,” Gulden said. “I can’t believe that this stuff happens across the country. I know it does, but when it happens to you, it just floors you. It’s unbelievable.”

Gulden said that after Block spent two weeks in a homeless shelter in Santa Fe, the local fire department gave him a ride to the Albuquerque airport so he could meet up with Gulden, who had flown in. Gulden brought Block back to Minnesota to be near family.

He was lucky to have relatives who could whisk him to a safer environment. Block now resides in a subsidized apartment. He has family and paid help assisting him with meals and housecleaning.

For people in Block’s circumstances without family support, some shelters utilize special units called “respite” centers.

Respite centers now number about 150 around the country, up from 80 in 2016, according to the National Health Care for the Homeless Council. They often are funded at least in part by local hospitals that want to avoid discharging homeless people back onto the streets.

They are designed to help homeless people recuperate for a few weeks after a health crisis. But with nowhere else to go, elderly people tend to stay far longer.

In Anchorage during the pandemic, shelter operators took over a hockey arena to provide socially distanced quarters for homeless people. But they quickly found that elderly people with wheelchairs and walkers could not get up the stairs from the arena floor to the mezzanine, where food was served. It highlighted the need for a vastly expanded respite unit for homeless elderly and disabled people.

Catholic Social Services has opened an expanded version of a respite center, what it calls a “complex care” facility in a former hotel, where more than 65 percent of current residents are 55 and older.

Still, residents are free to come and go, which poses problems when caring for people with dementia. One man in his 70s walked out in January and was found at the airport several days later, facility staff said. He told police he was waiting for a flight. He didn’t have a ticket.

“He had a coat on. He had a beanie on. He was well-prepared for the weather conditions. But I have no idea how he got out to the airport,” said Jessie Talivaa, program coordinator for complex care at Catholic Social Services. He did not recognize Talivaa when Talivaa showed up to retrieve him. “I said, ‘How about we go get a cup of coffee?,’ and I got him a cup of coffee and brought him straight home.”

Now the man is on a waiting list for an assisted-living facility in Anchorage. Talivaa said he is hopeful the man will get into the new place within a few months.

Yet another problem arises, however, when people approach death while in respite care, said Kushel, the San Francisco medical school professor and advocate.

“Medical respite was not intended to be palliative care, hospice care, end-of-life care,” she said, “yet some respite programs are starting to provide that service because there is nowhere else for these folks to go.”

Bueno, the Phoenix street physician, said ambulances pick up a dead person from a tent in The Zone about once a week. Reasons vary, but the combination of aging bodies, brutal living conditions and drugs is often deadly.

Nette Reed, an employee of the Human Services Campus, walks the streets early in the morning performing wellness checks on seniors.

Cheryl Sanders, 59, huddled in a pup tent, said she had returned to her spot on the street after being discharged from the hospital two weeks before, following what she said was a second heart attack. It was already hot out at about 8 a.m., and she was surrounded by heavy blankets. She appeared thin. She gratefully accepted water bottles.

She told Reed that she was ready to give up her tent and come inside a shelter, even though she said she has not gotten along with people in the shelter in the past.

“I’m tired,” Sanders said.

“You know I’ve been itching to get you off these streets,” Reed said.

Herron, the former autoworker, said in two interviews on consecutive days that said she has moved back and forth between her native Mississippi and Phoenix several times in recent years, traveling by Greyhound bus to be near family. Herron said she has endured sporadic homelessness for years.

She lived in an assisted-living facility for a time in 2022, she said, but even at the subsidized rate it consumed $600 of her $800-per-month Social Security payment. She moved in with a nephew, but that didn’t last and she wound up at one of several shelters at the Human Services Campus. Early this month she was waiting to move into a subsidized apartment that would cost her one-third of her monthly Social Security income.

It would probably leave enough for cable TV payments, she said.

For now, for diversion, she said she likes to ride the light rail cars that glide through downtown Phoenix. She enjoys hearing kids laughing on the train. She wears motivational wristbands; one says “Never Give Up,” the other says “One Day at a Time.”

Tears well near the surface. They overflow when talk turns to her adult children.

“They see me at Christmas,” Herron said, her voice quavering. “They call me Mama.”

[dexprs]

We shall not close above 4211, today.

[Elroy Jetson]

The debt will be paid on time, as always.

Once the Treasury runs short of money the White House has full discretion to keep paying the debt but not pay other obligations like Medicare providers, Social Security, or military pensions or pay, which is the real goal of extremist Republicans - a shrunken all-volunteer Army with no entitlements for retired Americans.

June 15 estimated tax payments are due which will provide some more time to see if any members of the Freedom Caucus get into any fatal accidents.

The real problem is while there are enough bipartisan votes to pass the McCarthy-Biden Compromise, the Freedom Caucus with one vote will vacate Kevin McCarthy from his position as Speaker of the House, maybe even before they allow a vote on the silly debt ceiling.

It's again going to a Freedom Caucus pandemonium and like Matt Gates said, "We don't see a need to negotiate with the hostage." They're dead-enders.

[dexprs]

Sorry about the late answer, but I think we shall hold until 4pm. After hours til Tuesday it could be another matter.

[dexprs]

In my opinion and I am not a politically savvy person, if Biden lets the US credit get downgraded from AAA to perhaps A, then I think they will hold him responsible come election time. He needs to use the 14th to avoid a default in the USA debt. Unless of course they will agree and avoid it in the first place.

[santafe2]

We just bounced off upper resistance at 4,211. A gambler would short this market over the weekend anticipating that talks will fall apart on the details. That's not me..:)

Of course, they may not and you could be well under water if the market stays this happy.

[santafe2]

Nick, do you think the market will do some just in case selling during the last hour or two? The market seems a bit too happy considering the close vote count in both the House and the Senate. A deal that could get votes from the Freedom Caucus may not get votes from the Senate Progressive Caucus, (the AOC caucus). From what little detail I can gather it appears student loan debt relief is getting the ax along with at least a portion of new IRS agents. Student loan relief was probably getting axed by the Supreme Court anyway. That ruling is coming next month. If ~44MM Americans have to start paying off student loan debt in September, discretionary spending is going to suffer. Or maybe Biden will just kick the can down the road again.

[santafe2]

Attached below is a chart of the 20-day moving average for the CBOE put-call ratio. This chart goes back to January 2020 which gives a sense of the ratio pre-pandemic, pandemic bottom and the complete overshoot - nothing could ever go wrong again - peak at the end of 2021. This chart makes a strong suggestion that the market bottom was October of 2022. I will look for a successful retest of support before beginning to re-enter the market.

The administration trotted out their Treasury under secretary to confirm they won't use the 14th Amendment to cure the debt ceiling impasse. The market appears to think that means they almost have a deal with McCarthy and the band of pranksters. I'm not so sure. If they don't before the market opens on Tuesday 5/30 the market may not be so sanguine.

[santafe2]

The bulls are winning this morning as the SPX is tackling resistance at 4,200 again. The short term high was on May 19 @ 4,211.

[santafe2]

We've got some very short term, (hourly), resistance in this area of the SPX.

[dexprs]

Yes, Icarus flew also.

[dexprs]

Energy Select Sector SPDR: Pivot points
THE FLY 8:27 AM ET 5/26/2023
The following are the pivot points for the Energy Select Sector SPDR. Pivot High: $79.30, Pivot Low: $78.12. These were calculated using the DeMark method. It is generally believed to be bullish when price breaks out above the pivot high or bearish when price breaks down below the pivot low.

[santafe2]

And it only starts there with the round globe lies. Gravity is a deep state invention. Before they created gravity to keep us down, everyone could fly...they kept it out of the Bible but it's still in the Apocrypha. Air used to be oxygen but now it's only 21% oxygen. Having trouble breathing? Deep state. And they're about to flip the magnetic poles, that's why they're melting the ice so it can flip easier. I can go on all day with this. Stupid people will believe anything and most will pay you to lie to them. I went into the wrong profession.

[Elroy Jetson]

Kandiss Taylor, who ran for governor of Georgia in 2022 and recently became a Georgia GOP district chair, is a flat earther: "Everywhere there's globes ... and that's what they do to brainwash. For me, if it is not a conspiracy, if it is real, why are you pushing so hard everywhere I go? Every store, you buy a globe, there's globes everywhere. Every movie, every TV show, news media — why?"

"The people that defend the globe don't know anything about the globe," said her podcast associate Dave Weiss. "If they knew a tenth of what Matt Long and I know about the globe they would be Flat Earthers just like the Bible says."

Kandiss Taylor, who ran for governor in 2022 and recently became a Georgia GOP district chair, is a flat earther: "Everywhere there's globes ... and that's what they do to brainwash." pic.twitter.com/PEz1sqOTvA

— Right Wing Watch (@RightWingWatch) May 22, 2023

[Elroy Jetson]

From Yale to jail - The brief career of an angry and hapless malcontent

Stewart Rhodes was born in Fresno where he grew up with his Mexican grandparents who worked as migrant farm workers while his mother, Dusty Buckle, worked as a Las Vegas radio preacher.

He joined the Army out of high school until he broke his back in a parachute training accident two years later.

He then worked as a parking valet in Las Vegas until he met his wife in 1991. Two months later he dropped a gun while on a date with her and shot his own eye out.

Rhodes then went to college and Yale law school on GI benefits and worked as a clerk for Arizona Supreme Court Justice Mike Ryan until he alienated his moderate Republican boss.

Following the loss of this promising entry-level job Stewart became increasingly alienated and developed deep anti-government views.

He volunteered for Ron Paul and joined armed standoffs, including at the one with the FBI at the Bundy Ranch.

He increasingly sensed he has a great destiny and his career culminated in January 2021 with a plot to overthrow the government, followed by a prison sentence.

[dexprs]

INTC maybe a stock moving up from the bottom of the BB on a 3std monthly chart, to the top near 3046, if they do not shoot themselves in the foot again. People may migrate to the tck stocks that did not take off, yet.

[dexprs]

It is as it should be, but more would have been better.

[santafe2]

This is the 21st Century version of kicking grandma to the curb.

[Elroy Jetson]

Oath Keepers leader Stewart Rhodes sentenced to 18 years in prison for his role in coup plot



Judge Mehta cited few reasons for this lenient sentence after noting "Sentencing guidelines range for Rhodes is roughly 21-27 years" with eligibility for additional time under a terrorism enhancement.

[dexprs]

Get the busses ready to run them over.

[santafe2]

You're on a roll this morning Elroy.

[dexprs]

Good time to nibble in bonds as I think the rates offered may dip lower after the Fed stops raising, including the assumption of the same.

[santafe2]

This is so last year, we've already had a president who can do that..:)

[Elroy Jetson]

Life Care Centers CEO Forrest Preston said, "We will unfortunately have to provide funds for transport out of our own resources because we can't afford the reputational hit of having our nursing centers surrounded by homeless people."

When asked to comment on nursing home evictions Kevin McCarthy said, "This is exactly the type of Americans who have become addicted to public benefits for decades, proving they're totally unwilling to become self-supporting. It's long overdue they take personal responsibility for their lives."

[santafe2]

Nick, looking at a short term chart of the SPX, (10 minute/3 week), the market is not down, it's still flat as a pancake with a little six day hill of hope-apathy-fear. The short term bottom is ~4,100 and top is 4,187. Other technicals suggest that we're close to the top for today barring any breakthrough on the debt ceiling.

One of the things we've learned about Uncle Joe is that just when we think he's sleeping away peacefully in his rocker he may unleash his Dark Brandon alter ego to smite the non-believers with the 14th Amendment. And I sayeth unto you; the debt of the United States shall not be questioned..:)

[Elroy Jetson]

If the federal government can’t make their June 2 payments Social Security recipients over the age of 88 will be the first to see their monthly retirement benefits end.


Echoing Sen Tim Scott, Kevin McCarthy promised, "We're going to successfully wrestle these entitlement programs to the ground."

Rep. Matt Gaetz (R-Fla.) on Tuesday added that he and his conservative colleagues “don't feel like we should negotiate with our hostage” on a debt-limit compromise.


Major nursing home chains including Life Care Centers of America have hurriedly prepared eviction proceedings for many residents in the event payments stop.

[dexprs]

As usual when the VIX hits 20 or above some of the volatility returns. VIX is a fear index for traders.
A more active day today than for a long time.

[Elroy Jetson]

For years the start-up app Noom Inc. has touted a psychological path to weight loss through 'mindfulness'.

The advent of GLP-1 drugs has prompted Noom to add a $120 per month option of Noom-Med which provides a prescription for a GLP-1 med like Wegovy or Trulicity.

A company spokesperson said Noom Med can now offer full strength mindfulness as a tablet or injection, "The Noom-Med app is chanting for you even as your Buddha explores new flavor sensations."

[Elroy Jetson]

NVDA is up 25% today after the company announced their latest AI board will be running for President of the United States.

The chipset can tell an astounding 13.6 million lies per second, making up fake news without prompting. In early tests the chipset was able to quickly to make 32,754 newly created culture wars go viral.


The chip maker expects $11 billion in revenue for the current quarter, an outlook that far surpasses the prior $7.2 billion consensus view and that would blow out of the water Nvidia’s previous quarterly revenue record of $8.3 billion.

[dexprs]

IMO: The market keeps dropping as it prices in via sellers, the bad news coming in the Debt Ceiling. Thus, to go out on a limb, when the bad news comes in the market may interpret it as not horrible and even take a bounce up.

[dexprs]

Energy Select Sector SPDR: Pivot points
THE FLY 8:26 AM ET 5/25/2023
The following are the pivot points for the Energy Select Sector SPDR. Pivot High: $80.82, Pivot Low: $79.52. These were calculated using the DeMark method. It is generally believed to be bullish when price breaks out above the pivot high or bearish when price breaks down below the pivot low.

[santafe2]

For anyone interested in the legal side of the debt ceiling, this seems to be a solid lawsuit. Forwarded to my Twitter feed from Lawrence Tribe. The article appeared in The New Republic.

The Lawsuit That Might Force Biden to Ignore the Debt Ceiling

An organization representing government workers is making a preemptive strike against the mounting default crisis.

During the two years they spent holding power in Washington, Democrats failed to disarm the debt ceiling time bomb that Republicans have repeatedly wielded over the past decade. Now they are wrestling with the potential consequences of the latest and greatest standoff over raising it. President Joe Biden and Speaker Kevin McCarthy are reportedly making little progress in negotiations over the trillions in unpopular spending cuts and new restrictions that the House GOP wants to enact in exchange for not blowing up the economy.

One solution would be for the Biden administration to recognize that the debt ceiling is unconstitutional. The Fourteenth Amendment declared in 1868 that the “validity of the public debt authorized by law ... shall not be questioned.” A logical reading of that language is that Congress cannot authorize spending that exceeds the nation’s tax revenues and then later forbid the Treasury to pay off that debt. But Biden aides are reportedly downplaying the use of this option to progressive lawmakers.

A recent lawsuit could nonetheless force their hand. The National Association of Government Employees, or NAGE, filed a federal lawsuit against the Biden administration earlier this month to block it from enforcing the debt ceiling. The union argued in a court filing last week that the debt ceiling violates the public debt clause and that abiding by it is already injuring NAGE’s members. A hearing on a preliminary injunction is set for next Wednesday. While its chances of success are uncertain, the lawsuit itself underscores the constitutional netherworld in which the nation’s leaders now find themselves.

Most debates over the debt ceiling’s constitutionality imagine that it will not become a courtroom matter until the bomb actually goes off. When that happens, the Biden administration will essentially have two choices. Treasury Secretary Janet Yellen can stop paying off existing debts and thereby default on the national debt for the first time in American history. Alternatively, she can “prioritize” making those debt payments over things like paying civil servants and mailing out checks to veteran pensioners. That would bring the United States into a state of technical default while theoretically mitigating some of the damage.

If Yellen instead chose to continue issuing new bonds to cover existing debt, that would violate the debt ceiling and likely set up a showdown at the Supreme Court. Most observers imagine in this hypothetical scenario that Biden or Yellen or a lawyer working for them would just say “Fourteenth Amendment!” while issuing the bonds; conservative legal scholars have argued that ignoring the debt ceiling on those grounds would itself be unconstitutional. “The idea that the Fourteenth Amendment gives the president unilateral power to borrow is dangerous nonsense,” Michael McConnell, a former federal judge, recently argued in a New York Times op-ed.

NAGE’s lawsuit spins some of these assumptions on their head. Most discussions of the debt ceiling depict it as a burden imposed upon the executive branch by Congress. The union argued that the debt ceiling actually amounts to a line-item veto for the president to wield at his own discretion. What appears to be a restriction based on the political dynamics of the situation is actually, according to the filing, an unconstitutional transfer of congressional power.

“Already near the debt limit, the last Congress adopted in the current fiscal year a budget that would require adding $1.5 trillion in debt without identifying or indicating any priority of payments once the limit on indebtedness was reached,” the lawsuit claimed. “Congress then failed to raise the debt ceiling or increase taxes and effectively offloaded the dirty work of repealing parts of the spending that Congress itself had just approved.”

The Supreme Court previously struck down a line-item veto in the 1998 case Clinton v. New York. Writing for the court, Justice John Paul Stevens noted that the Constitution had carefully and deliberately laid out the process by which bills become law. Deviations from that “finely wrought” structure are unconstitutional, especially when they result in “truncated versions” of the laws that were actually passed by Congress.

It would be one thing if Congress had laid out the order in which federal spending must be “prioritized” after the debt ceiling is met, the union noted. But it argued that Congress effectively delegated that power to decide which federal spending must be cut or canceled to the executive branch. By crafting a debt ceiling, Congress ceded a core legislative power to another branch of government and compromised its authority over federal spending.

Some legal scholars have already pointed out that the debt ceiling’s existence amounts to a constitutional no-win scenario for a president. Law professors Neil Buchanan and Michael C. Dorf recently noted that Congress had placed the executive branch in a “trilemma,” in which he must violate the Constitution in some way. “Once we hit the debt ceiling, Biden will bump into a constitutional obstacle no matter what he does,” they wrote in a Los Angeles Times op-ed. “Failing to spend appropriated funds, raising taxes, or borrowing money to pay the bills would all infringe on Congress’ constitutional powers.”

NAGE’s lawsuit also emphasized this quandary for the president. “The Debt Limit Statute has placed the President in an impossible position, without legislative permission or constitutional authority as to how to proceed,” the union said in its original complaint. “Under Article II of the Constitution, the President is obligated to execute all the laws, without exception, and may not be placed by Congress in a position where the President has to determine what laws are of continuing force and require payment, once the limit on total indebtedness is reached.”

What makes the union’s lawsuit noteworthy is also how it avoids some of the procedural questions that might bedevil other debt ceiling lawsuits. The U.S. technically already hit the debt ceiling on January 19, as Yellen informed Congress at the time. The Treasury has avoided default thus far by relying on what it describes as “extraordinary measures,” or certain creative accounting maneuvers. In this case, Yellen told lawmakers that she would suspend the Treasury’s investment and reinvestment in various civil servant retirement funds that were authorized by law, to give the country some breathing room.

In the filing, the union argued that this amounted to a legal injury for its members. “The debt issuance suspension period continues in effect and continues to diminish the value of the assets of the benefit plans of the CSDRF and Thrift Savings Plans in which [NAGE’s] members are participants,” it claimed. “While [Yellen] is required by 5 U.S.C. 8348 to make good on these losses when the debt issuance suspension period ends, there is presently no end in sight or increase in the debt ceiling, and the retirement plans continue to lose value.”

Maryland Representative Jamie Raskin told The Washington Post in a recent interview that, in his view, the Supreme Court is usually “fastidious” about whether a party has legal standing in a particular lawsuit, which would insulate ignoring the debt ceiling from legal challenges. NAGE argued that it had overcome the standing hurdle, albeit from the opposite direction. “Aside from this actual injury, [NAGE’s] members face certain and imminent harm when the United States runs out of cash to pay its bills,” the union also noted. “Although individual members may or may not be furloughed, and there will be different degrees of individual injury from layoffs, all of [NAGE’s] members face an imminent and certain injury from delay in their paychecks, whether for days, weeks, or months.”

Naturally, this is not how things are supposed to work. When Congress added the public debt clause to the Fourteenth Amendment during the Reconstruction era, its drafters’ immediate concern was various Civil War debts. But they also made clear that they had much broader aspirations in mind. “I have no doubt that every man who has property in the public funds will feel safer when he sees that the national debt is withdrawn from the power of a Congress to repudiate it and placed under the guardianship of the Constitution than he would feel if it were left at loose ends and subject to the varying majorities which may arise in Congress,” Massachusetts Senator Benjamin Wade told his fellow lawmakers during the drafting debates.

Will the Supreme Court agree? It’s impossible to say. Predictions about how the court would rule on particular cases are difficult even when they traverse familiar areas of constitutional law. The Supreme Court has heard vanishingly few cases on the public debt clause’s meaning since its enactment, however, and none of the court’s current members have ever been part of one. If the dispute reaches the justices, it might be one of the highest-stakes cases they ever hear. Nothing less than the integrity of the national debt and the stability of the American financial system would be on the line.

[Elroy Jetson]

Wagner mercenary chieftain Yevgeny Prigozhin said in an interview with pro-Russian blogger Konstantin Dolgov, that Moscow’s troops are unprepared to resist forces loyal to Kyiv even when they enter Russian territory.

"In the middle of our war, Russian Volunteer Corps groups come in effortlessly and go through the Russian border in tanks and APCs without any repercussions and make their own videos if it,” the Wagner chief vented.

“I believe Ukrainians today are one of the strongest armies in the world,” Prigozhin said. He called Kyiv’s forces “highly organized, highly trained and their intelligence is on the highest level, they can operate any military system with equal success, a Soviet or a NATO one.”

If Russian losses continue to mount, “all these divisions can end in what is a revolution, just like in 1917. First the soldiers will stand up, and after that – their loved ones will rise up. It is wrong to think that there are hundreds of them – there are already tens of thousands of them – relatives of those killed,” he said. “And there will probably be hundreds of thousands – we cannot avoid that.”

Prigozhin adds a rude gesture to emphasize his comment that Russian Defense Minister Sergei, "Shoigu's draft evading son-in-law Alexey Stolyarov is a dickwad," who runs a 'fitness blog' - The literate ex-felon quoted the late Russian General Alexander Lebed saying, “Let me recruit a platoon of the children of the elite, and the war will be over in a day.”

[santafe2]

Apparently Kohl's has found a way to make a small profit. They're up 16% today on earnings of 13 cents a share. Let me do the math; that's 52 cents a year on a share price of $22.28 or 43X earnings. Hum, KSS at 43X earnings or MSFT at 34X earnings. Now there's a difficult choice..:).

I'm not dead.

[santafe2]

They hire the people to bribe people making the tax codes.

Why sir, I just won't tolerate that language. You must keep a civil tone while I pick you pockets.

[dexprs]

People with money, ie; people who have the means of avoiding the rates people working for a wages pay, make the rules for the game. They hire the people to bribe people making the tax codes. This is why the system stood so far.

[dexprs]

VIX moved over 20 today.

[dexprs]

Round trip trades in PODD Calls and PANW, KOF, Puts. PANW got a good earnings report and a strong forecast going forward.

[Elroy Jetson]

That's the same problem built into the tax code for humans.

Humans who work for a living pay tax rates much closer to those in other industrialized nations.


But humans who have enough money to invest pay hardly anything at all. I could easily pay far more in taxes to make our government functional with a balance budget.

But many humans with enough capital to invest can bribe our legislators and donate dark money to disinformation campaigns.

I still find it hard to believe Americans tolerate this.

[santafe2]

This is the image of a market with no direction for the last 13 months. SPX 3,900 was the mid point for 10 months and became support in March. There are good arguments for the market to rise from here, continue in this channel and to take another dive down into the mid-3,000s. That's why I'm on the sidelines in fixed income for now. About 2/3s of my portfolio will mature at the end of the month and I'll likely switch to a lower return, more liquid investing vehicle.

[santafe2]

Although the last couple of days have had a downward bias, we're still in the same narrow channel we've been in since the beginning of April. The broad market is poised to make a strong move. The question of course is, which direction?

I'll post the entire, now 13-month chart in a few minutes.

[santafe2]

I don't think we disagree. Small companies pay a lot of taxes. The system has been designed like that for decades, if not longer. The current tax system is designed to ensure mega cap companies pay almost no taxes. Roughly twice as many companies now pay no taxes. I wouldn't be so negative about the current 21% rate if there was a minimum AMT. When you compound zero tax, billions in free cash flow, corporations as people and money as speech, democracy has no place in that system.

[DewDiligence]

Actually, many smaller and midsized companies (including several in my portfolio), who lacked ex-US revenue, far-flung subsidiaries, and the ability to execute complex tax-avoidance strategies, paid income tax at the statutory 35% rate (plus state income tax) prior to the Trump tax cut.

[dexprs]

Reputation is easy to lose and very hard to regain.

[dexprs]

"Brilliant Plan" from Mac. Into the hands of the extreme right.