Trump Embeds ‘Loyalty Monitors & Enforcers’ Across Cabinet Agencies

In an Orwellian-sounding step, The White House has planted politically appointed aides in government agencies to monitor President Trump’s Cabinet secretaries’ loyalty (according to The Washington Post).

Barry Bennett, a former Trump campaign adviser, encouraged the embed strategy, however.

“Especially when you’re starting a government and you have a changeover of parties when policies are going to be dramatically different, I think it’s something that’s smart,” Bennett told the newspaper.

 

“Somebody needs to be there as the White House’s man on the scene. Because there’s no senior staff yet, they’re functioning as the White House’s voice and ears in these departments.”

The network of political appointees reports to Rick Dearborn, left, the White House deputy chief of staff for policy, according to administration officials.

As The Hill details, every Cabinet agency has an embedded appointee, with the job title senior White House adviser, who is situated near the secretary’s office, the newspaper reported.

These appointees report to the Office of Cabinet Affairs instead of the Cabinet secretary. 

 

The appointees serve as observer and White House enforcers, the Post reports, ensuring that the agency’s leadership implements the president’s agenda.

 

Agencies with embedded appointees include large departments like Energy and Health and Human Services, as well as smaller agencies including NASA, records shared with the Post from a ProPublica Freedom of Information Act request show.

Some of the aides are reportedly being shut out by the secretaries and the aides.

Environmental Protection Agency Administrator Scott Pruitt has shut out the aide in his agency for offering unsolicited advise during his staff meetings, the Post reports.

Sounds very Orwellian even in the face of constant leaks – maybe better to full drain that swamp first?

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Accounting Change On Operating Leases To Add $3 Trillion In Debt To Corporate Balance Sheets

From a practical perspective, operating leases are pretty much the same as debt.  They reflect a contractual obligation on the part of one counterparty to make defined stream of cash payments to another over a set period and with an implied intere…

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Chevron Unlikely To Expand Major Australian LNG Projects

The oil price slump has shifted the trend in new project investments towards smaller projects with faster returns and away from mega projects, and Chevron is unlikely to sanction another major LNG development in Australia, according to Nigel Hearne, managing director of Chevron Australia and head of the Australasia business unit. “The mega projects of the past decade are giving way to smaller, more targeted investments with quicker economic returns,” Hearne said in a speech at the Committee for Economic Development of Australia on Tuesday.…

Chevron’s $1B Chinese Offshore Oil Asset Sale Hits A Snag

Chevron’s plan to sell its non-operated interests in oilfields offshore China for up to $1 billion has been stalled since the U.S. major has not received good enough bids, Bloomberg reported on Tuesday, quoting people in the know.Chevron had planned to sell the stakes it holds in three oilfields in the Bohai Bay in China, but since no bidder has matched the price the U.S. group had been aiming for, Chevron is thinking of keeping the interests for now, Bloomberg’s sources said.According to the sources, Chinese companies AAG Energy Holdings,…

Silicon Valley: From Rarified Air To Exhaust Fumes

Authored by Mark St.Cyr,

As we sit here today the IPO that was supposed to prove that the dream of “its different this time” were still alive-and-well, has shown it is anything but. The real crush for the “crushing it” crowd is this – the reality that proves that the party is over came from both a business and service whose main product did nothing more than augment reality as to add cartoon features to pictures then disappear into the ether. And this you were told was why it should be worth 10s of $BILLIONS of dollars in market cap.

As inane as that was, what became all too surreal was when this concept was applied to its S-1 where the reality of its business plan appeared to be nothing more than a “pig in lipstick” matching its core product features.

And “The Valley” along with the entire tech world in general not only believed it, but argued that this business was worth those $10’s of BILLIONS of dollars even though the company itself stated in its own business plan that not only was it not profitable – it may never be.

Sounds logical only if you live in the augmented business view of “The Valley.” Too the rest of us in the real business world? It’s crazy talk. Plain, and simple.

The compounding issue that Snapchat™ is generating (for it’s not reserved solely within the virtual world) is the near laughing-stock faces that appear to be growing across one of the most least informed investor public of this era: The hordes of Millennials who lined up to be “first” much like they used to for an iPhone® release (remember those?) and bought shares as soon as they became available to the public at $24. And the higher it went, the more they bought, and the better the felt.

Then, as soon as it begun – it was over.

To truly understand just how quickly this entire debacle in the making has fallen, let me express it this way:

Since going public on Thursday, March 2nd, its shares had risen some 44% from its IPO price of $17 to its opening exchange price of $24 to then zoom to near $30. This was greeted with exuberance and cheer not only for those who got in line to be “first.” But was also used by much of the tech press as to show just how “worth it” this debut and idea was.

Yet, it didn’t stop there.

If you turned on your financial/business media program of choice the results were the same. The accolades coming from the “tech” side reporting was filled with both sighs-of-relief, and a little smugness of, “See, those naysayers just don’t get tech or social. This proves the IPO market is alive and well!”

That was as of Friday, March 3rd, the day after the IPO’s debut. Then came Monday, and let’s just say – it was different this time.

By Monday the reporting went from, shall we say, exuberance mode – to justification mode. i.e., Don’t panic!!!

If you once again perused not just the broadcast media, but also the printed or online, the commentary was the same: “It’s still up 44% from its IPO price!”

Well, yes, that was true, yet, that was far from accurate as to explain what was taking place. A much better description of what was playing out would be something along these lines:

“Initial investors purchasing shares of Snapchat as it became a public company via the exchange profits now match the company’s core product. e.g., POOF! They’re gone. And it’s appearing to get worse. Much worse.”

By Tuesday anyone who had purchased at the opening bid of $24 would now not only have had any potential profit sent to the ether – everyone, and yes, everyone who stood in line to be first on either Thursday, or Friday just 4 days prior was now losing money on their core investment dollars. And like I said – it was only Monday.

By Friday of that same week? The meme of “Still up 44% from its IPO price of $17!” had fallen silent as that now had been halved. And yes – it gets worse.

Over the next 5 trading days the once again “IPO to prove to the world that not only unicorns were great, but “decacorns” were just fantastic powerhouses of business” began morphing into a creature that far too many dream themselves could do: It became a “teenager.”

In other words, its share price now began using numbers that began with “teen” as in 19, then 18 as its share price continued falling until finally ending the week solidly far, far beneath its triumphant $24-ish close only 5 trading days prior as they say in the investing world – “remaining a teenager” closing at $19 and change.

The issue here is that process has one key attribute: It’s the same pattern we’ve seen before, but now it’s represented in days. To wit:

From IPO to today. What had once taken well over a year has morphed from months to now days.

(Chart Source)

Back in 2013 I argued that the meme of “its different this time” and more had taken over all sense of reality within “The Valley” (i.e., tech in general), and once the effects produced via the Fed’s ending of QE were in full force the resulting backlash would become prominent for those willing to look. And I pointed to the current songbird of all that was “the Valley” Twitter™ as the canary-in-the-coalmine one needed to watch diligently. The above shows the results of that warning in all too glaring detail.

I made a few more observations (as well as warnings) both before, as well as during that are germane for further context. From September, of 2014, “The Shot Heard Round The Valley World” To wit:

“Once the Fed shuts down the section of QE that has been pumping Billions upon Billions of dollars every month – it’s over for a great many of today’s Wall Street darlings.

 

Think of it this way: Who is going to fund your next round when they no longer have access to the Fed.’s piggy bank? Let alone pump more money into older start-ups that just haven’t produced any real money (as in net profit,) but have produced nothing more than great new employee digs or benefits?

 

Tack along side this the culture shock in what will seem near instantaneous with the shunning that will take place of any business resembling the, 3 employee, menial customer base, Zero if not negative profit margin businesses formed with the implicit intent as to be bought up or “acquired” for Billion dollar pay days.

 

These will be the first to go. That formulation is going way of the now infamous Pets dot-com sock puppet. This will be the first true shock to Silicon Valley culture that hasn’t been seen in many years. And it will be far from the only one.”

That was in 2014 and the reaction to such heresy was like showing the cross to a vampire. Or said differently – I was not going to be on any “list” to speak at any of the hipster inspired tech conferences. The issue? It’s precisely what happened and the great IPO drought began in earnest to the dismay of the entire tech vis-à-vis “The Valley” complex.

Another was made a year later in the article, “Crying Towels”: Silicon Valley’s Next Big Investment Op” Again, to wit:

“Twitter is (again, in my opinion) a real-time microcosm of what’s about to hit the whole Valley. i.e., A real shite storm, and here’s my reasoning…

 

There are two issues that are very different for both a company as well as the narrative of a whole industry supported by the wings of such a “canary.” And both of these go a little more than unrealized by those not familiar with them. For it hits right at the heart of how a meme or, a presumptive “It’s different here” attitude takes hold when true business principles, disciplines and more get lost on those desperate to not see their world view crushed. But business in its purest form has a way of doing just that – crushing naive or wishful assumptions.”

The idea of publicly arguing the above was met with derision and scorn by many across the mainstream financial/business media, along with those emanating via the tech press with its own cadre of talking-head “Valley” aficionados.

The issue that many were trying to uphold (and pleading for) revolved around the argument that “It’s hard to tell when you’re in a bubble when you are in one.” And followed that up with – “And we don’t believe we’re in one.”

I took and argued the direct opposite view. Here’s how I describe it:

“No. It is easy to spot when you’re in a bubble. The requisite for that spotting is the willingness to actually look. For when fundamental business reasoning are not only circumvented with “fairytale logic” but the argument for even greater tales are needed ever-the-more? You know – it’s a bubble. The real question after that realization is this:

 

Do you have the wherewithal to overcome the FOMO (fear of missing out) urges that will surely end in tears as the bubble may inflate further? For the argument has moved from anything resembling business, directly to psychological argumentsonly, where emotions are the rule, not the fundamental rules of business. And the resulting frenzy can last far longer than anyone can contemplate. For you’ve moved from fundamental reasoning to pure psychological, emotional, groupthink.

 

The compounding issue is this: Those who believe they can “get out” when needed before-hand fail to realize it’s that same thinking (an emotional one) that will keep them in, rather than get them out in time. There’s a reason the term “Ride the tiger” persists to this day. Getting on “its back” to begin with has proven over the centuries to be precisely the wrong move.”

To paraphrase from the movie “War Games”: Sometimes, the only winning strategy is not to play. Even if not playing makes you appear (and scorned) as the one who “doesn’t get tech.” On an aside, people forget the public scorn via the investing class for Warren Buffett’s refusal to invest in the tech space during the late 90’s when fortunes were being made overnight. Then to be declared an investing genius by this same cadre when he had no direct exposure to the following dot-com crash.

Today, one can clearly see the “bubble” has indeed popped. The issue for those currently blindsided is that they were (and some still are) clinging far too fiercely to their “fairy tales” of IPO-stock option riches, than a child still wanting to believe in Santa.

Snapchat’s IPO perfectly fits that analogy. The only current unknown is: was that coal that was left behind? Or something else?

To all this I argued the case back in May of last year, “If Everything Is So Great, Where Are The Unicorn IPOs?” Once again, to wit:

“Over the course of the last week it seemed no matter where I turned in the business media one meme was being pushed above all others: It’s still a great time to be a private tech unicorn. Implying, that funding rounds were still “robust.”

 

What wasn’t said, so I will, is this: It’s a great time to be a private “unicorn” rather, than take the chance and become the poster-child for the IPO apocalypse. For it’s better to be assumed a $BILLION dollar success story rather, than IPO and officially open the books to the market and remove all doubt – that you’re not.”

This was right before Twilio™ announced it was going public and bringing forth its own IPO to the then (and still) barren IPO market. This event (for I have no feelings about the business itself) was used as the foil to put all the naysayers (yours truly in particular) back under the rocks they envisioned we crawled out from as to dance upon our heads with the prancing hooves of the resurgent unicorn IPO market and meme.

Hint: The above chart shows you just how all that “its different this time” was greeted via the new reality of: it surely is – different.

As you can clearly see from the above charts (or “pictures” as they say in “the Valley”) what once took well over a year to develop (as I warned would take time to develop via the initial lingering effects of QE) as witnessed through the Twitter IPO and resulting share price; took the same resulting actions to appear in Twilio’s only a few months.

And now Snap’s appears to have followed the same pattern. The problem? It’s been only 12 trading days. Yes – days.

So now let me end with these questions:

What happens if (or when) Snapchat’s next headline reads: Share prices fall below $17? And where do investors go to get their “lousy T-Shirt?” Or should I say “crying towels?”

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Japan Oil Refiners Fear Chinese Rivals Will Squeeze Them Out

Japanese oil refiners are worrying that China’s new fuel standards that are driving higher output will ultimately result in a deadly loss of market share for the Japanese firms.Bloomberg reports that the Japanese Trade Ministry has called in a task force including around twenty “top oil experts” to find a way out of the situation, which seems to be getting worse by the day. Japanese refiners were having a rough ride even before oil prices started sliding in 2014, as domestic demand waned. Now their market share abroad, in the…

US Bans Laptops, iPads, ‘Anything Bigger Than A Cellphone’ On Flights From 13 Countries

U.S. government officials have temporarily banned most electronics (including laptops, iPads, and Kindles) on certain flights into and out of the country, according to Jordan’s national air carrier.

As The Hill reports, Royal Jordanian posted on Twitter Monday that “following instructions from the concerned U.S. departments, we kindly inform our dearest passengers departing to and arriving from the United States that carrying any electronic or electrical device on board the flight cabins is strictly prohibited.”

The ban does not apply to cell phones or medical devices, but does include laptops, tablets, electronic games and cameras. Those items can be stowed in checked baggage, however.

The Guardian notes that Saudi Arabia’s Saudia Airlines and Royal Jordanian airlines are among the affected countries; the full list has not been revealed to the affected airlines themselves.

The email – described as a “circular” – is not a public regulation, but airlines will be expected to enforce the new rule. Airlines were issued the circular on Monday and given 96 hours to comply.

 

The circular does not address electronic flight bags (EFBs), which allow flight crews to display diagrams mapping flight patterns, maps of airports and other digital documentation, usually on an iPad.

 

The lack of specificity leaves airlines in the dark as to whether their employees will be cited or otherwise punished for performing the vital functions of aircraft crew as usual.

Compliance has been swift: “Effective March 21st, the carriage of electronic and electrical devices inbound to the USA shall only be inbound in checked baggage except for mobile and medical devices,” according to a reservation agent at one of the affected airlines.

Royal Jordanian airlines tweeted a reference to the restrictions, referring cryptically to “concerned US departments”.

It was suggested that Royal Jordanian disobeyed the circular in part by making its existence known. (NOTE: The tweet has been deleted since The Guardian reported it.)

@zerohedge Somewhere in Hawaii a judge is declaring that having a laptop in your carry-on is a universal human right.

— El Diablo Blanco (@MercutioProzac) March 20, 2017

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