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The problems started for the Warriors on the offensive end. The Warriors’ coaching staff has stressed keeping their offense simple, but it was anything but for most of the first half. The Warriors coughed up 13 turnovers in the first 24 minutes. Stephen Curry was the main offender, throwing one-handed passes into thick... |
Early in the third quarter, it looked as if the Warriors’ swoon might continue. When Tristan Thompson scored an easy bucket with 10:38 left, the Cavs pulled within one. Then, the Warriors’ talent asserted itself. The Warriors forced J.R. Smith into isolation against Kevin Durant, and Durant drilled a three-pointer over... |
Underlying the Warriors’ offensive outburst were a few significant adjustments. After 13 turnovers in the first half, the Warriors simplified their offensive attack and stopped turning the ball over (only 3 in the third quarter and 7 total for the second half). The team put the ball in Curry’s and Durant’s hands and le... |
At the defensive end, Durant was masterful during 5 third-quarter minutes at center while Green was on the bench with foul trouble. His length kept bothering the Cavs at the rim, and the Warriors’ small-ball, switch-everything line-up repeatedly snuffed out shots when the Cavs mistakenly thought they were in the clear.... |
The Cavs also have an MVP, and he was terrifying for much of the early part of the game. But James seemed to wear down as his teammates failed to provide much support. Kevin Love scored 7 points in the first 4:30 of the third quarter, then managed only 5 points for the rest of the game. Kyrie Irving, under relentless p... |
So far, the Finals have been a damned-if-you-do, damned-if-you-don’t exercise in frustration for the Cavs. They’ve played 96 minutes, and it’s not clear they’re any closer to coming up with a winning formula against the Warriors. That may be because there isn’t one. If the Cavs go big, the Warriors run past them. If th... |
From Adem Tumerkan: In just two days – September 15 – it will be the 10-year anniversary of Lehman Brothers collapse. The date they filed bankruptcy. |
With nearly $620 billion in debts, it was the largest bankruptcy in history. |
Now, a decade late – it appears the mainstream’s learned nothing. And many have forgotten the crisis that was 2008. . . |
The banks are bigger and the damage of them crashing will be even greater this time around. |
The elites – led by the Federal Reserve – have since 2008 told banks to continue lending and for consumers to continue borrowing. They did this by cranking interest rates down to zero (technically 0.25%). This allowed funds and ‘shadow banks’ to borrow huge amounts on margin. |
It also kept commercial banks continually lending out loans. And at the end of the day if they lent out too much and didn’t have enough legal ‘reserves’ (deposits) to close, they’d simply ring up another bank (or the Fed) and borrow the amount needed. |
Borrowing at near zero and lending out at higher rates was very lucrative. And basically, free money. |
Banks can ultimately borrow from the Fed for 0.25% and lend out to the U.S. government for a solid 2-3% nominal return. Or even better, they’ll lend out to consumers who want a new house at a higher interest rate. Students that need debt for college. Auto loans. Or Emerging economies that need funding. |
There’s more to it – and I’ll highlight it more in-depth in later articles. But aslong as interest rates are low, the game continues. |
But the problem is – and just like before 2008 kicked off – short term interest rates are now rising. |
All these banks that borrowed trillions from one-another and the Fed now have increasing debt servicing costs. Meanwhile the long end of the yield curves lowering, and many loans they’ve already lent out are locked in at a fixed rate. That $500,000 30-year mortgage that mom and dad refinanced will stay at 4.5%. |
So as short term rates are rising, and long term rates are falling – that’s squeezing bank and other lending institutions margins. . . |
It won’t be long until the yield curve inverts. Don’t know what I’m talking about? You can read more about that here – and why it’s preceded the last nine straight recessions. |
Not too long ago I also wrote about how subprime auto loan delinquencies are at a 22-year high. And how credit card delinquencies are also surging. |
All because of rising short term interest costs. |
Putting it plainly, the higher short-term interest rates go up – the more fragile the entire system becomes. |
History shows us that every time the Fed raises rates – there’s eventually a crisis. |
This time won’t be any different – in fact, it will be far worse. . . |
One huge reason is that the U.S. government’s borrowing at amounts that it hasn’t since the 2008 recession. |
Now, during a recession, it’s permissible (thanks to John Maynard Keyne’s economic theories) for the government to pile on tons of debt. |
But once the recession’s over, budget deficits need to contract again. |
And that’s the farthest thing from what’s happening 10 years after 2008. |
For instance, the fiscal year isn’t even finished yet (one more month to go) and the U.S. budget deficit is just shy of $900 billion. |
That’s a 40% increase since last year. . . |
President Trump’s tax cut plan and increased spending is causing deficits to swell. |
And because of this, the Congressional Budget Office (CBO) has significantly raised their deficit projections over the 2018 – 2025 period. And the scary part is that they don’t even expect a single recession or slow down between now and then. These projections are assuming steady growth and a healthy economy. |
They’re clearly not accounting for any margin of error here. . . |
But just imagine how much the debt will be after another recession – when the U.S. will need to pile on even more debt. . . |
While the government’s spending is out of control – especially at a time when the economy’s supposedly ‘healthy’ – the bigger problem is the cost of servicing all this debt. |
Ignoring private consumer debt (which will be greatly affected by rising rates), the U.S. National Debt recently hit $21.3 trillion – with no signs of slowing down – and the interest payments due on all this debt is at a record high. |
You can see that since the Federal Reserve began raising rates in December 2015, the cost of interest payments on the national debt has soared. |
It just hit an all-time high of $538 billion per year. . . |
Remember, the U.S. is taking in less tax revenue because of Trump’s tax cuts. So the Treasury will have to borrow new debt just to pay off maturing old debt and interest. |
This is what Hyman Minsky – one of my favorite economists – called a ‘Ponzi’ scenario – when you need new debt to pay off old debt. |
And if interest costs are this enormous from the Fed raising rates to just 2%, imagine how much it will cost if it goes to 3% or higher. |
Short term interest costs will continue to rise over the near-term because of three reasons: higher inflation, Fed tightening, and the increased amount of debt needed by the Treasury. |
Like I wrote above, the higher short-term rates go – the worse lenders will do. And if the lenders, like banks, can’t make profits – they’ll collapse under all that debt. |
For the anniversary of Lehman Bros, I warn you – never forget the toll of too much debt and rising interest rates. |
This has been the economic recipe for many problems throughout history – whether it’s corporations, governments or people. Borrowing huge amounts when rates are low and not being able to pay it all back as rates rise is fatal. |
Because of all this, the financial system will continue becoming fragile – and sooner than later something will break. |
The Financial Select Sector SPDR Fund (XLF) was unchanged in premarket trading Friday. Year-to-date, XLF has gained 0.80%, versus a 9.42% rise in the benchmark S&P 500 index during the same period. |
Sep. 1, 2018 12:46 PM PT1:46 PM MT2:46 PM CT3:46 PM ET19:46 GMT3:46 12:46 PM MST1:46 PM CST2:46 PM EST2:46 PM CT23:46 UAE15:46 ETNaN:� - McKinnon will miss the entire season after tearing the ACL in his right knee on the final play of practice Saturday. |
Analysis: The 49ers were counting heavily on McKinnon this season after signing him to a four-year, $30 million contract in free agency. The 49ers now have three healthy running backs on the roster in Matt Breida, Alfred Morris and Raheem Mostert. |
Top Republicans in the Congress head with President Donald Trump to Camp David on Friday for two days of meetings about the GOP agenda for this year, as the White House looks to build on legislative momentum from approval of a sweeping package of tax cuts at the end of 2017, and turn that into positive results in the H... |
"Look, the President was elected because of his ambitious agenda and his desire to get a lot of things done," White House Press Secretary Sarah Huckabee Sanders told reporters this week. "We’re going to focus on that." |
Among the issues that have been mentioned prominently in recent weeks by the President and White House officials - welfare reform, funding for new roads and bridges, border security and more - but unlike last year when the top items were clearly health care and taxes, 2018 doesn't have a headline GOP issue as of yet. |
"A lot of the meetings that the President has this week with leadership will help determine what the best strategy is on each of those individual areas," Sanders added. |
Another major issue will be what happens in late 2018 - the November mid-term elections - which will test whether Republicans can keep control of the House and Senate. |
Losing one - or both houses of Congress - could imperil the Trump agenda, much as the 2010 Tea Party wave altered the political calculus for President Barack Obama and Democrats. |
One thing that's obvious is that President Trump and Congressional Republicans will look to campaign hard on the tax cuts enacted into law in December, with the GOP arguing that it's all part of an economic upswing spurred by Mr. Trump's election. |
"The historic tax cut I signed into law just two weeks ago before Christmas, is already delivering major economic gains," the President said in a recorded video statement played to reporters in the White House briefing room on Thursday. |
"Hundreds of thousands of us are seeing larger paychecks, bigger bonuses and higher pension contributions, and it's all because of the tax cuts and the tax reform," Mr. Trump added in his recorded statement. |
"The President's economic agenda of lower taxes, less regulation, and more opportunity for all is already paying off, and American families and workers are the big winners," added Press Secretary Sanders. |
That White House message is being echoed on Capitol Hill as well on a daily basis by Republicans. |
"Despite the doom and gloom rhetoric from the Left and special-interest groups, millions of hardworking people are already seeing benefits," Speaker Paul Ryan's website proclaimed. |
"Folks are skeptical about Washington in general right now and I get that, but it is real middle-class tax relief and it will affect people’s bottom line, so I think that will be important," said Sen. Rob Portman (R-OH) on CNBC. |
"And I am just amazed that my Democratic colleagues objected to it," said Sen. Bill Cassidy (R-LA). |
Democrats still argue it was the wrong choice - the 2018 elections could well be seen as a referendum on that, and the first two years of the Trump Presidency. |
(CNN) -- Severe storms shattered parts of southern Mississippi early Saturday, killing at least three people in Forrest County, state Emergency Management Agency spokesman Greg Flynn said. |
The National Weather Service office in Jackson dispatched a damage survey team to the area to investigate what was a likely tornado that also damaged buildings in Hattiesburg and Petal, including parts of a college and a fire station, officials said. |
"There are widespread power outages as the tornado ran across three counties lines -- Lamar, Forrest and Perry County," Flynn said. |
Hattiesburg, the largest city in Forrest County, has taken a lot of damage, the National Weather Service said in an advisory. |
A search and rescue operation is underway in Hattiesburg, a city of about 46,000 people, Mayor Johnny DuPree said before dawn Saturday. A tornado may have caused the damage, CNN affiliate WDAM-TV reported. |
Most of Hattiesburg's damage appeared to be on the downtown's outskirts, DuPree said. A fire station was damaged, as were parts of William Carey University, a private Christian college with about 4,000 students. |
Students at William Carey were reporting minor injuries, the university said. Dormitories and other buildings were damaged, the school said. |
"Officials working to ensure students are safe. Some students reporting minor injuries. Damage to dorms, Tatum Court, Thomas Hall," the university said on Twitter. |
The university tweeted that the Hattiesburg campus is closed until further notice: "Students are being escorted from campus. Arrangements will be made for students who cannot go home." |
Windows were blown out and roofs of buildings peeled back at the Hattiesburg Salvation Army, WDAM reported. |
WDAM reporters and editors posted to Twitter pictures of severe damage in Hattiesburg and the adjacent city of Petal, a community of about 10,400 people. |
Parts of an AT&T store and a loan shop collapsed at a shopping center in Petal, one of the images showed. |
Damage also was reported elsewhere in Forrest County -- which includes Hattiesburg -- as well as Lamar and Perry counties, the Mississippi Emergency Management Agency said. |
Interstate 59 north of Hattiesburg was closed because of debris, said the agency, which asked the public to avoid traveling in the area because of downed power lines and other destruction. |
The storms were part of a system moving through southern Mississippi and Alabama on Saturday morning. |
A tornado watch was in effect for parts of Alabama through most of Saturday morning, the National Weather Service said. |
CNN's Allison Chinchar and Kayla Rodgers contributed to this report. |
United Airlines is piloting the use of non-binary gender descriptors for customers flying with the company. |
The airline company made the announcement on Twitter Friday morning, making it the first U.S. airline to offer non-binary gender options. |
Customers will be able to choose the prefix "Mx." during bookings, and they'll have the option of identifying as male, female, undisclosed or unspecified. |
"United is excited to share with our customers, whether they identify along the binary of male or female or not, that we are taking the steps to exhibit our care for them while also providing additional employee training to make us even more welcoming for all customers and employees," United's Chief Customer Officer To... |
The airline has been working with the Human Rights Campaign and The Trevor Project in training employees on the new changes, per the release. |
Mikhail S. Gorbachev signaled a shift in the Soviet position on the 1972 antiballistic missile treaty in a letter to President Reagan last week, Administration officials said today. |
In the letter, according to the officials, the Soviet leader moved toward a possible compromise on the period for which the two sides would adhere to the ABM treaty, thus delaying deployment of the United States' space-based missile defense program. |
The American officials said Mr. Gorbachev had proposed adherence for up to 15 more years. The previous Soviet position was 15 to 20 years. |
In Moscow, a First Deputy Foreign Minister, Yuli M. Vorontsov, said at a news conference that Mr. Reagan had been told by Mr. Gorbachev that the Soviet Union continued to insist on guaranteed observance of the ABM treaty terms for at least 15 years as part of a larger agreement to reduce long-range arms. |
President Reagan proposed in a letter to Mr. Gorbachev on July 25 that the two sides abide by the 1972 pact for seven and a half more years. |
The question of how long each side should keep to the treaty is fundamental. The Soviet Union says the issue must be settled before reductions can be worked out on long-range arms. |
Mr. Gorbachev's reply, delivered Friday by Foreign Minister Eduard A. Shevardnandze, also suggested shifts on medium-range arms even as the two sides differ over the case of Nicholas S. Daniloff, the American reporter in Moscow who has been accused of espionage. |
The shifts on medium-range arms had been signaled earlier by Soviet officials. They include dropping a Soviet demand that British and French national forces be restricted under an interim agreement. The Soviet Union has also agreed that there could be a global limit on medium-range missile warheads, covering forces in ... |
Mr. Gorbachev has held firm to the position that the treaty should be strengthened and that this is a condition for achieving reductions in strategic arms. The treaty restricts the research, development and testing of antimissile systems. In addition to pledging to abide by the treaty for a long time, the Soviet Union ... |
The definitions, if accepted, would block the testing of antimissile systems in space. However, the Russians have said the interpretations are negotiable. The United States has asserted that it has a legal right to move to a looser interpretation of the treaty. |
But the indication that the Soviet Union is prepared to be accept a somewhat shorter commitment to the treaty could open the door to compromise. |
Even if the two sides were to agree on the period of continued adherence, they would still have to work out exactly how this would be done. |
The United States has not explicitly offered to give up the right to withdraw for the specified period. |
Instead, President Reagan has put forth a plan under which each side agrees to restrict itself to research, development and testing of ABM systems to that allowed by the treaty for a five-year period. If the research is successful and one side wants to deploy, there would be negotiations for up to two years on how this... |
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