Failing Thursday – Comey Testifies, ECB Goes Neutral and Oil Collapses

What to talk about first?  

We already got the text of Comey’s opening statement, which sounds like a meeting out of the Godfather – you’re not going to nail Trump on what he said – he’s had too much practice at that.  Trump even told Comey he wasn’t stupid enough to get his hookers in Russia because he assumed he was being filmed at all times.  Trump has always been known for his skill at avoiding prosecution – he’s not going to slip up now.  

What matters is actions and the question is, did the President’s actions amount to obstruction of justice and did Jeff Sessions engage in a conspiracy to obstruct justice when he ignored the request by the FBI Director (Comey) to prevent any further contact between the President and Comey?  Comey literally said “please don’t leave me a lone with that man“!  Since Comey was already concerned about being influenced and Sessions and Trump continued with the harassment (same rules as sexual), did they create a hostile work environment for Comey leading to his improper firing?  

This will obviously go on for a while and all this is a distraction from the real investigation as to how deeply Team Trump was tied to Team Putin during the elections.  ”Not at all” is already off the table so now it’s a matter of sorting through all the BS and finding out what the real connections were and all THAT is a distraction from the fact that yes, Russia did indeed mess around with a US election – that’s getting a pass while we sort all the rest out.  

Speaking of passes, I’m not giving one to Sessions and neither is Samantha Bee, who came out strongly against his renewed war on drugs in last night’s show and made many excellent points:

Part 3 (click here) is a great example of the difference between what happens to you when you are white/rich and arrested vs what happens to you when you are poor/black and arrested and THAT is why the War on Drugs is actually a War on the Poor.  Of course the entire Administration’s agenda is essentially a war on the poor – just the kind of thing a Russian Government would want to see if they wanted to destabilize America.  Job well done!  

Meanwhile, we had another chance to short the Dow (/YM) this morning at 21,200 and the Russell (/TF) at 1,399 and we just (8:20) called longs on Oil (/CL) at $45.45 and Gasoline (/RB) at $1.495 which, as you can see from our earlier cash-out of yesterday’s Live Trading Webinar play, already gave us a lovely $1,500 gain which, along with $500 on oil, was still our worst day of the week so far.  

We had an exhaustive discussion about oil and gasoline in the Webinar and a replay will be up later today with our logic in this trade but the short story is we’re taking advantage of the overreaction to yesterday’s inventory report ahead of the holidays.  This may not be the bottom, but we’re pretty sure the top is ultimately higher than here.  

In other market-moving news, the ECB left rates unchanged but removed the guidance regarding further rate cuts, indicating the floor is truly and finally in.  However, the bank still says it expects rates to remain at present levels for an extended period of time.  Goldman Sach’s (GS) stooge, Mario Draghi will speak a bit later this morning and is likely to also remove his language about significant downside risks as the Global Economy seems to be stabilizing.  

What’s not stabilizing is our climate and the IEA just released a report stating  that the 2M EV cars on the road aren’t enough to make a “significant contribution” to greenhouse gas emission reduction targets. “In order to limit temperature increases to below 2°C by the end of the century, the number of electric cars will need to reach 600 million by 2040.”  2040?  That’s only 23 years from now and that means they want to see about 30M electric cars hitting the road every year from now on.  

Only 1M electric vehicles were sold last year so just about 1% of the total and we need to hit 1/3 of the total within 3 years and anyone who thinks we can pull that off without Government involvement is smoking something Jeff Sessions will lock you up for 20 years for even possessing!  That’s why Donald Trump taking the US out of the Paris accords may be the straw that breaks the planet’s back.  We only have one shot at fixing this – and he’s blowing it for all of us.  

Stop the madness!  

Provided courtesy of Phil’s Stock World.