Monday, August 26, 2013 - And the Answer Is

And the Answer Is

by Sinclair Noe

DOW – 64 = 14,946
SPX – 6 = 1656
NAS – 0.22 = 3657
10 YR YLD - .02 = 2.78%
OIL + .29 = 106.21
GOLD + 7.20 = 1406.00
SILV + .25 = 24.43

President Obama awarded Army Staff Sergeant Ty Carter the Medal of Honor in a ceremony at the White House today. Carter is now the fifth living recipient of the decoration for heroic actions in Iraq or Afghanistan. The Medal of Honor, the nation's highest military honor was awarded for Carter's distinguished service on October 3, 2009 at Combat Outpost Keating in Afghanistan. More than 300 Afghan insurgents launched an attack against the remote, mountainous outpost; of the 53 fellow 4^th Infantry Division soldiers who defended the outpost that day, eight were killed and 25 others injured.

They were outnumbered six to one; the fact that anyone survived is a testament to the heroism of the day. In another part of the compound, former Staff Sergeant Clinton Romesha, battled against incredible odds. Romesha was the second survivor of that battle to receive the Medal of Honor. Carter risked his own life to resupply his fellow soldiers and to rescue a battle buddy; Carter was wounded but continued to fight; all this while under heavy and constant fire that lasted more than six hours. It is hard to imagine the hell those soldiers endured that day.

The wounded soldier that Carter rescued, Specialist Stephan Mace, would later die. Carter blamed himself. For Carter, the battle also resulted in a ninth fatality. A fellow survivor who struggled with post-traumatic stress disorder committed suicide a year after the attack. When he returned stateside, Carter recognized that he was suffering from PTSD. His experiences led Carter to become active in helping veterans of the Iraq and Afghan wars deal with PTSD.

Sgt Carter's citation reads: "Carter's remarkable acts of heroism and skill... exemplify what it means to be an American hero."

During the ceremony, Mr Obama said he wanted to honor Sgt Carter for the "other battle he has fought" - coping with PTSD. The president said: "To any troops or veterans who are watching and struggling: look at his man, look at this soldier… he's as tough as they come, and if he can find the courage and the strength to not only seek help but to speak out about it [PTSD], to take care of himself and stay strong, so can you."

Whenever there is war, there is a terrible price to pay.

About an hour after the president presented the Medal of Honor to Sgt Carter, Secretary of State John Kerry read a statement about the situation in Syria. Kerry said the use of chemical weapons in attacks on civilians in Syria last week was undeniable and that the Obama administration would hold the Syrian government accountable for what he called a “moral obscenity” that had shocked the world’s conscience. Kerry accused the Syrian government of seeking to cover up the use of the weapons, and he rejected its denial of responsibility for what he called a “cowardly crime.”

Kerry also said the Syrian government’s refusal to allow immediate access to the attack sites last week was a telling indicator that it was trying to hide responsibility. Even though a United Nations team was finally permitted by the Syrian government to investigate starting today, he said, the government’s authorization was “too late” to be credible. Then came word that the UN inspectors had been fired upon by snipers; although there were no reports of injuries, some of the inspectors vehicles were disabled.

Meanwhile, Russia's foreign minister warned against prejudgment, and said bypassing the UN Security Council would be a violation of international law. He warned any Western intervention would be a serious mistake.

Defense Secretary Chuck Hagel told reporters today: “if there is any action taken, it will be in concert with the international community and within the framework of legal justification.”

The New York Times reports there is a list of potential military targets in Syria. The White House could take certain military measures without the approval of Congress. We saw that move in Libya. What Congress does control is the pocketbook.

Congress is on recess until Sept. 9; when they return they will look at raising the debt limit. House Speaker Boehner said last month the Republicans wouldn’t increase the debt ceiling “without real cuts in spending” that would achieve a further reduction in the deficit. Treasury Secretary Lew has said the Obama administration won’t negotiate on the debt limit. The Bipartisan Policy Center, a nonprofit research group, has estimated the government will reach the point where it is unable to pay its bills sometime between mid-October and mid-November unless Congress increases the limit. So, enjoy the final days of Summer because things might get scary around Halloween.

POP QUIZ: Everybody close your books and take out your pencils, unless you're driving of course.

First question: Name the world's biggest fast food chain. The correct answer is Subway, which has just opened its Subway store number 40,000. McDonald's only has 34,700 restaurants. Subway claims they still have room to grow.

Next question: name the second largest stock exchange in America. Of course, the New York Stock Exchange is the largest exchange, averaging 1.28 billion in average daily volume, for a market share of 23%. The second largest stock exchange is the BATS Global Markets, which is the new and not so catchy name for the combined exchanges of the BATS and Direct Edge, which averages 1.15 billion in daily share volume, or 20.6% of the total market. The Nasdaq falls to the third spot, with 18.1% market share.

The third question is: Name the best selling new car in California over the past year. Answer is: Toyota Prius hybrid.

Bonus if you can name the eight major car brands that Tesla Model S has passed in sales in California in the past year: Answer: Mitsubishi, Lincoln, Land Rover, Fiat, Buick, Cadillac, Chrysler, Jaguar, and Porsche. That’s especially impressive when you consider that those brands are selling multiple different cars, whereas the Model S is the only Tesla vehicle in production.

Put your pencils down and pass your papers to the front of the room.

Yep, it's school days once again.

Last week was a bore. Not much in the way of economic data, just the Federal Reserve officials making a point of not saying anything at the Jackson Hole confab. Typically there is a post Jackson Hole bounce in the markets, but we warned you against any such expectations. And in the absence of other noise or significant changes in the fundamental outlook for the companies that make up most of the US stock market, the market pretty much ended exactly at the same level it ended in the previous week.

Wall Street is paying too much attention to the “taper”, the prospect of a slowing of Fed asset purchases, and not enough attention to the economy in general or the looming game of debt-ceiling chicken in specific. The stimulus campaigns of the Federal Reserve and the central banks of Europe and Japan, by depressing domestic interest rates, have helped to push trillions of dollars into developing markets in recent years.

Now that the Fed has declared its intent to start easing up on the accelerator by the end of the year, some of that money is starting to slosh out of emerging markets and some might even return to the US.

Outflows from emerging markets have exceeded inflows since the Fed’s June announcement; Bloomberg calculates that emerging-market stocks have lost more than $1 trillion in value; emerging-market currencies are depreciating rapidly. The question of what to do about it was a big topic in Jackson Hole. The answers were pleasantly realistic, as the general consensus seems to be don't worry, be happy, it'll all work out over time.

And finally, P Morgan Chase’s co-head of litigation is leaving the bank as it faces a mounting pile of regulatory headaches, lawsuits and investigations, said people close to the situation. Michael Coyne, who is responsible for all litigation and government investigations affecting J.P. Morgan around the world, will become general counsel of UnionBanCal Corp, a San Francisco based bank.  Mr. Coyne’s departure comes as J.P. Morgan tries to work its way through a litany of legal problems and a heightened period of regulatory scrutiny. The bank disclosed recently that future legal losses could be as much as $6.8 billion above its existing reserves, more than any other U.S. bank.

And the answer is: how can you tell your ship is sinking?