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Former CIA Director John Brennan arrives for a Senate Intelligence Committee hearing on "Russian Activities and Intentions in Recent Elections" on Capitol Hill in Washington, U.S., May 16, 2018. (Photo: Reuters)

Former CIA Director John Brennan arrives for a Senate Intelligence Committee hearing on “Russian Activities and Intentions in Recent Elections” on Capitol Hill in Washington, U.S., May 16, 2018. (Photo: Reuters)

The White House announced on Wednesday that it is revoking the former CIA chief John Brennan’s security clearance. White House Press Secretary Sarah Huckabee Sanders said any benefit to keeping his clearance is “outweighed by the risk.”

“The president has a constitutional responsibility to protect classified information and who has access to it,” she said, adding that he “is fulfilling that responsibility in this action.”

Mr. Brennan has been a staunch and vocal critic of President Donald Trump, an insult-thrower whose own critics characterize as irrational and unstable.

Rudy Giuliani, who now serves as the personal attorney to the president, said the former CIA head should face a grand jury for his role in peddling the salacious dossier used to justify the “phony” Russia investigation.

He slammed Mr. Brennan for being the “quarterback,” who took still-unproven politically-funded opposition research disguised as intelligence, from former British spy Christopher Steele.

“Unless he’s the biggest idiot intelligence agent that ever existed—although he never really did much intelligence work—it’s false,” the former New York City Mayor and U.S. Attorney said. “You could look at it [the dossier] and laugh at it.”

Interestingly, Mr. Brennan ran into a problem during his first CIA lie-detector test in 1980.

Donald Trump’s Full Statement Revoking John Brennan’s Security Clearance

Press Secretary Sanders also said the White House is considering revocations for James Clapper, Susan Rice, Michael Hayden, James Comey, Bruce Ohr, Peter Strzok and Lisa Page.

Mr. Clapper, who has been accused of lying to Congress under oath twice, was the former Director of National Intelligence (DNI) in the Obama Administration. He resigned on November 17, 2016.

The House Permanent Select Committee on Intelligence (HPSCI) said he “provided inconsistent testimony” to Congress regarding his contacts with the media. Put plainly, Mr. Clapper, who  lied to congressional investigators about leaking to the media. Further, the committee found those leaks among others “damaged national security and potentially endangered lives.”

It reveals former Obama Administration officials leaked information that “correlate to specific language found in the Intelligence Community Assessment.” That assessment, which held the Russians hacked the Democratic National Committee (DNC) and Clinton campaign chairman John Podesta to help Donald Trump, was erroneously portrayed in the media as a consensus among “17 intelligence agencies.”

In truth, it was the assessment of three officials handpicked by none other than Mr. Clapper, himself.

“Former Director of National Intelligence James Clapper, now a CNN national security analyst, provided inconsistent testimony to the Committee about his contacts with the media, including CNN,” the report states under “Finding #44.”

This would not be the first time Mr. Clapper lied to the U.S. Congress under oath.

He made an admittedly false statement to the U.S. Congress in March 2013, when he responded, “No, sir” and “not wittingly” to a question about whether the National Security Agency was collecting “any type of data at all” on millions of Americans.

Roughly 3 months later, documents leaked by former National Security Agency (NSA) contractor Edward Snowden proved that answer untruthful. In reality, the NSA was collecting in bulk the domestic call records, along with various internet communications of U.S. citizens.

James Comey, who triggered the special counsel investigation by leaking government memos, was fired as deputy director of the Federal Bureau of Investigation (FBI).

Peter Strzok, the counterintelligence agent at the center of the Clinton email and Russia probe, was fired from the FBI Friday after the inspector general reviewed his personal messages. They revealed what the IG called “clearly a bias state of mind,” which Deputy Attorney Rod Rosenstein admitted.

“I certainly agree with the findings of the inspector general report,” Mr. Rosenstein told Congress. “I think those messages clearly do indicate bias.”

Ms. Page, along with FBI lawyer Jim Baker, both of whom worked closely with Mr. Comey, resigned from the agency in May.

The White House announced on Wednesday that

Chairman, CEO and President of Nucor John Ferriola and U.S. Steel CEO Dave Burritt flank U.S. President Donald Trump as he announces his administration will levy new tariffs to product U.S. steel and aluminum manufacturing companies. (Photo: Reuters)

Chairman, CEO and President of Nucor John Ferriola and U.S. Steel CEO Dave Burritt flank U.S. President Donald Trump as he announces his administration will levy new tariffs to product U.S. steel and aluminum manufacturing companies. (Photo: Reuters)

Despite widespread media panic over tariffs, the Atlanta Fed Business Inflation Expectations remained unchanged at 2.1% in August. The index has remained unchanged for the last 3 months.

In fact, while business inflation expectations have fluctuated, they overall have remained unchanged since December 2017. In fact, they’ve ticked down since a one-time increase to 2.3%.

In December 2016, the month to report just before Donald Trump was inaugurated, business inflation expectations came in at 2.1%.

Further, even as sales levels remained “about normal,” profit margins improved somewhat and year-over-year unit costs increased somewhat to 2.0%, on average.

The majority of firms expect labor costs to put moderate upward pressure on prices over the next 12 months. Worth noting, the Bureau of Labor Statistics reported today that labor productivity rose 2.9% for Q2 2018 and unit labor costs are down 0.9% on an annual basis.

Fifty percent (50%) of firms said they expect non-labor costs to also put moderate upward pressure on prices over the next 12 months. Most firms expect productivity, margin adjustment, and sales levels to have little or no influence on prices over the next 12 months.

Still, the special question for the month asked about their expectations regarding the influence of recently enacted tariffs on their sales revenue, number of employees, input costs, and capital investment over the next 12 months.

Despite widespread media panic over tariffs, the

Roofers work on new homes at a residential construction site in the west side of the Las Vegas Valley in Las Vegas, Nevada April 5, 2013. (Photo: Reuters)

Roofers work on new homes at a residential construction site in the west side of the Las Vegas Valley in Las Vegas, Nevada April 5, 2013. (Photo: Reuters)

The NAHB/Wells Fargo Housing Market Index (HMI) edged down just 1 point to a still-solid reading of 67 in August. Builder confidence in the market for newly built single-family homes remains robust.

“The good news is that builders continue to report strong demand for new housing, fueled by steady job and income growth along with rising household formations,” said NAHB chairman Randy Noel. “However, they are increasingly focused on growing affordability concerns, stemming from rising construction costs, shortages of skilled labor and a dearth of buildable lots.”

For 30 years, the HMI has gauged builder confidence — or, homebuilder sentiment — for current single-family home sales and sales expectations over the next six months as “good,” “fair” or “poor.”

The HMI also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

“The solid economic expansion and firm job market should spur demand for new single-family homes in the months ahead,” said NAHB chief economist Robert Dietz. “Meanwhile, builders continue to monitor how tariffs and the growing threat of a trade war are affecting key building material prices, including lumber.”

The HMI subindex gauging current sales conditions ticked lower 1 point to 73, while the components in the subindex measuring expectations in the next 6 months fell a single point to 72. The metric for buyer traffic fell 2 points to 49.

“These cost increases, coupled with rising interest rates, are putting upward pressure on home prices and contributing to growing affordability challenges, as indicated by the latest quarterly reading of the NAHB/Wells Fargo Housing Opportunity Index.”

The 3-month moving averages for regional HMI scores in the South and West each held steady at 70 and 75, respectively. However, the Northeast and Midwest each fell 3 points to 54 and 62, respectively.

Builder confidence in the market for newly

Employees have short meeting in the warehouse to check business inventory levels of goods. First in first out. (Photo: AdobeStock)

Employees have short meeting in the warehouse to check business inventory levels of goods. First in first out. (Photo: AdobeStock)

The Census Bureau (US) reported that business inventories rose by 0.1% in June, matching the consensus forecast.

Sales

The combined value of trade sales and manufacturers’ shipments for June, adjusted for seasonal and trading-day differences but not for price changes, came in at an estimated $1,452.2 billion. That’s 0.3% (±0.1%) higher than May 2018 and 8.2% (±1.2%) higher than June 2017.

Inventories

Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $1,937.2 billion, up 0.1% (±0.1%)* from May 2018 and were up 4.0% (±1.3%) from June 2017.

Inventories/Sales Ratio

The total business inventories/sales ratio based on seasonally adjusted data at the end of June was 1.33. The June 2017 ratio was 1.39.

The Census Bureau (US) reported that business

American Manufacturing Sector Graphic Concept. (Photo: AdobeStock)

American Manufacturing Sector Graphic Concept. (Photo: AdobeStock)

Industrial production edged higher by 0.1% in July, missing the 0.3% consensus forecast and 0.5% average over the last 5 months. Manufacturing production rose 0.3% after a slight dip two months before, matching the consensus forecast.

The output of utilities moved down 0.5 percent, and, after posting five consecutive months of growth, the index for mining declined 0.3 percent. At 108.0% of its 2012 average, total industrial production was 4.2% higher in July than it was a year earlier.

Capacity utilization for the industrial sector was unchanged in July at 78.1%. That’s 1.7% below its long-run (1972–2017) average and 0.1% below the median forecast.

Industrial production edged higher by 0.1% in

A collage graphic concept for industry and labor. (Photo: AdobeStock)

A collage graphic concept for industry and labor. (Photo: AdobeStock)

Labor productivity in the second quarter (Q2) 2018 rose 2.9%, up from the 0.3% gain in Q1 and easily beating the 2.5% consensus forecast. Unit labor costs fell 0.9% in Q2, also beating the 0.2% forecast, even as output gained 4.8% and hours worked increased 1.9%.

The decline in unit labor costs was fueled by a 2.0% increase in hourly compensation and a 2.9% increase in productivity. Unit labor costs have 1.9% over the last four quarters.

Manufacturing sector labor productivity rose 0.9% in Q2 2018, as output increased 1.9% and hours worked increased 1.0%. Productivity increased 0.9% in the durable manufacturing sector, as output and hours worked rose 2.4% and 1.4%, respectively.

In the non-durable goods manufacturing sector, the 1.1% gain in productivity was fueled by a 1.5% increase in output and a 0.4%increase in hours worked. Over the last 4 quarters, total manufacturing sector productivity has actually fallen 0.2%, as output rose 1.8% and hours worked rose 2.1%.

Unit labor costs in manufacturing rose 0.6% in Q2 2018 and increased 2.7% from the same quarter a year ago.

As People’s Pundit Daily (PPD) previously reported, labor productivity in 2017 rose 2.7% in wholesale trade and 2.8% in retail trade, easily outpacing their 10-year averages. From 2007 to 2017, labor productivity in wholesale trade and retail trade rose by just 1.1% and 2.0%, respectively.

Labor productivity in the second quarter (Q2)

A factory worker at a New York manufacturing plant. (Photo: Reuters)

A factory worker at a New York manufacturing plant. (Photo: Reuters)

The Empire State Manufacturing Survey rose 3 points to 25.6 in August, easily beating the 20.0 forecast. The general business conditions index was fueled by strong gains to new orders and shipments.

The index for future business conditions climbed four points to 34.8.

While the new orders index was little changed at an already strong 17.1, the shipments index jumped 11 points to 25.7. These readings indicate strong growth in regional factory activity.

Forty-two percent (42%) of respondents reported that conditions had improved over the month, while just 16% reported that conditions had worsened.

Though the index for the number of employees ticked down slightly lower, at 13.1, it indicates a pickup in employment levels. The average workweek index was 8.9, indicating a moderate increase in hours worked.

Price increases remained elevated. The prices paid index inched up to 45.2, and the prices received index came in at 20.0.

The Empire State Manufacturing Survey rose 3

Group of friends sitting outdoors with shopping bags; several people holding smartphones and tablets. (Photo: AdobeStock/ OneInchPunch/PPD)

Group of friends sitting outdoors with shopping bags; several people holding smartphones and tablets. (Photo: AdobeStock/ OneInchPunch/PPD)

The advance estimates of U.S. retail sales came in at $507.5 billion in July, an increase of 0.5% (±0.4%) and far more than the 0.1% forecast.

That’s also 6.4% (±0.5%) higher from July 2017.

Total sales for the May 2018 through July 2018 period rose 6.3% (±0.5%) from the same period a year ago. From May 2018 to June 2018, the percentage change was revised from a gain of 0.5% (±0.4%) to a gain of 0.2% (±0.2%).

Retail trade sales were up 0.4% (±0.5%)* from June 2018, and 6.0% (±0.5%) above last year. Gasoline Stations saw a giant 22.2% (±1.6%) gain from July 2017, while Nonstore Retailers were up 8.7% (±1.4%) from last year.

The advance estimates of U.S. retail sales

New York Stock Exchange (NYSE) Building in the Lower Manhattan Financial District, New York City. (Photo: Tomasz Zajda/AdobeStock/PPD)

New York Stock Exchange (NYSE) Building in the Lower Manhattan Financial District, New York City. (Photo: Tomasz Zajda/AdobeStock/PPD)

Good morning! Welcome to Street Vision

We had originally thought an August rollout would be perfect timing. The dog days of summer typically bring a more relaxed news cycle, allowing us to weave into the first few entries the concept of Street Vision and what value we hope it brings to your week.

The reality has become that the 24/7 news cycle just doesn’t take a breather, and there’s so much to talk about, we’re just going to hit the ground running at the mouth, or rather the keyboard, and trust that you’ll get it. Got it? Let’s go!

Turkey, Tariffs, and Technicals

We are a day shy of halfway through the third quarter (Q3), and at least 90% through the Q2 earnings season, with retailers reporting this week. Midday Tuesday markets are doing a spectacular job of recovering from a 2 day selloff, that was largely in response to the currency crises and economic turmoil in Turkey that finally boiled over to dominate ecopolitical headlines Friday through Monday.

So, Let’s talk Turkey

Turkey’s problems didn’t come out of the blue. The steady decline in their currency, the Lira, and hideous monetary policy has been percolating for at least 18 months. The decline began to resemble a death spiral a month ago when Erdogan seized total control of the Turkish Central Bank, who he had been in a row with all year over his insistence that they NOT raise interest rates.

So, after Erdogan wins re-election in early July, he replaces the then-head of the Turkish Central Bank with (I can’t make this up) his son-in-law.

Seriously.

When this happens on July 10, the Turkish Lira falls 18% YTD. Now it’s down 50% YTD — 34 days later. Today, the Turkish 10 year Sovereign Debt has a yield of just over 20%. And that’s down from 24% yesterday!

My point is that over 90% of Turkey’s problems are self-inflicted.

But why do we really care? It’s Turkey! Why does it matter?

The harsh reality is that anytime the currency of a country even the size of Turkey goes into a death spiral, the collateral damage around the globe is very hard to define.

Markets Hate Uncertainty

Turkey has 80 million people and the world’s 17th largest GDP at just under $1 Trillion. Both metrics are much larger than Greece. Remember the havoc that reverberated through the European continent earlier in the decade over the economic crisis in Greece.

Now, Turkey is not in the European Union (EU), and Greece is an EU member state that also has the EURO as their currency. But Turkey is in the North Atlantic Treaty Organization (NATO), and was admitted to NATO in 1952 for a very strategic reason — geography, Russia and Iran to the east, Iraq and Syria to the south, the Mediterranean Sea and former eastern bloc countries of Europe to the west.

Turkey is easily the perfect place on the planet for ecopolitical and geopolitical turmoil.

That being said, after 2 days of brisk selling, with 2 hours left in the day, U.S. Equity markets were shrugging it off with a nice rally. The caveat is, despite the Turkish Lira rallying +4% from Monday and the Turkish Equity ETF; TUR rallying +10% after getting crushed for 2 days.

Despite that rally the TUR ETF is still 20% below where it was 2 days ago, and there’s very little rally elsewhere around the globe in the emerging markets world.

Turkey has done very little to fix the real problem, being that they still haven’t raised interest rates at the Turkish Central Bank yet.

I don’t know about you, but I’ve had way too much Turkey for 1 day. Tariffs and Technicals will have to wait. Stay tuned.

I’m cutting this short to catch the first post — Omarosa faux bombshell White House Presser. Guaranteed to be a ratings bonanza!

It's Turkey, tariffs and the technicals in

U.S. President Donald Trump at the first meeting of the Presidential Advisory Commission on Election Integrity co-chaired by Kansas Secretary of State Kris Kobach (L) at the White House last week. (Photo: Reuters)

U.S. President Donald Trump at the first meeting of the Presidential Advisory Commission on Election Integrity co-chaired by Kansas Secretary of State Kris Kobach (L) at the White House last week. (Photo: Reuters)

Kansas Governor Jeff Colyer conceded to Secretary of State Kris Kobach in the Republican primary. He also said he would endorse Mr. Kobach, who was endorsed by President Donald Trump.

“I’m issuing a call to unity,” the secretary of state said in a statement. “It’s imperative we’re all on the same team come November.”

The two men were separated by 110 votes at 40.6% each, or 127,211 to 127,101.

Mr. Kobach will face Democrat Laura Kelly in the general gubernatorial in November. While the secretary of state was seen as a more vulnerable candidate, the race remains Likely Republican on the PPD Election Projection Model.

Kansas Governor Jeff Colyer conceded to Secretary

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