The Swamp never intended honesty

Americans for Tax Reform: The federal government has failed to properly monitor enrollee eligibility for Obamacare, according to a report by the Government Accountability Office (GAO). As a result, the government has made billions of dollars in Obamacare subsidy payments to individuals that may have been committing fraud.

As the report notes, the system used by the Centers for Medicare and Medicaid Services (CMS) relies on data sent by three government agencies – the IRS, SSA, and DHS – to check eligibility for Obamacare. However, the system used by CMS is unable to verify many inconsistencies in the data.

This inability to properly verify enrollment has meant billions of dollars have been sent out to enrollees without verifying whether the applicants were fraudulent.

Look no further than California.  The exchange was run, with state mandated secrecy and special DC bailouts.   The exchange was an immigrant recruiting tool,  followed by the Legal Illegal Alienship program.  California has always intended to stick Texas with the medical bills of the new immigrant children.  This was a Nancy Pelosi plot hatched with John Perez, then speaker of the house.  Remember Nancy and Jerry opening our southern border and nearly declaring a secession during the election for governor?  During that period a collection of media outlets in latin america began pushing migration onto their public, all in cooperation with  the Pelosi/Perez/Brown plot.

I thought it a brilliant secession strategy,what better way to insure the independence of the South West, just make Texans so pissed they join the secession.  Texans, unfortunately, thought they could staying the union, the socialist bums they are.

California bust

CNBC: Sales in the West, which has seen a sharp increase in home prices amid tight inventories, plummeted 32.1 percent to a 110,000 unit-rate, the lowest level since July 2014. The percent decline was the largest since May 2010.

Whoops.  Of all the bad news, to have California leading another national housing bust is the baddest.   Look for construction layoffs.

Ethereum is taking off

Ethereum is the new semantic network technology supporting crypto, honest contracts,guaranteed closure, virtual coins, block chain of various sorts.  The developers are growing by 1,000 a week, as seen in the met-up growth.  Go to the bottom of the screen and click on meet-up. The meet up groups are concentrated in Europe and NYC.  

Central bankers beware, capital flows are moving in to the bot network, central bankers need to join the network.  How can the Fed not notice what is happening?

California's middle class is bottlenecked

CalWatch: “In 2006, 38 percent of middle-class households in California used more than 30 percent of their income to cover rent. Today, that figure is over 53 percent,” according to Christopher Thornberg, director of the UC Riverside School of Business Administration Center for Economics Forecasting and Development. “The national figure, as a point of comparison, is 31 percent. It is even worse for those who have borrowed to buy a home — over two-thirds of middle-class households with a mortgage are cost-burdened in California — compared to 40 percent in the nation overall.”

Recent studies illustrated a continuing plunge in homeowning among traditional buyers in-state. “California’s middle class is being hammered,” wrote Joel Kotkin at the Orange County Register. “The state now ranks third from the bottom, ahead of only New York and the District of Columbia, for the lowest homeownership rate, some 54 percent, a number that since 2009 has declined 5 percent more than the national average.”

They are leaving the state, going to greener pastures.   Unfortunately those of who stay are stuck wth the pension bill.

Horse manure from the Manhattan District Attorney

It is the Constitution of the United States, not the commercial interests of Apple, that protects our privacy. It protects our security as well. Our judiciary is required by that Constitution to demand that the government establish probable cause case-by-case and phone-by-phone. That requirement, not the encryption technology of a private company, is our best protection from abuse.

Manure.  The Supremes have long since given up on following the constitution.   If the Manhattan District Attorney really thought unlawful seizure should be stopped, then he would push for overturn of All Writs.

Services and housing starts crash

Say today's bean counters, go look  it up.

It may be that the communists have stabilized capital flows to normal, or the Chines home buyer became cautious in the bubble.  But if this trend holds, then the recession is here today.  Housing and services were the last two holdouts.

Did Trump go racial pandering?

Donald Trump won among Hispanic voters in Nevada, according to entrance polls released from Tuesday night's caucuses, fulfilling an oft-repeated campaign pledge.The GOP presidential front-runner, who coasted to an easy victory in the Silver State, won 44 percent of the Hispanic vote, according to MSNBC's entrance polls, topping Marco Rubio's 29 percent and Ted Cruz's 18 percent.

Both Rubio and Cruz are Cuban-American.

Entrance polls are not always precise, but Trump used the news to bolster his claims that he's attracting a broad coalition of support as he addressed his supporters in a victory speech Tuesday night.

Los hispanos votaron como si la raza no importa ~ Pero los demócratas siempre complacer a su voto. Este es un mal presagio para las posibilidades del Dem, Hillary sabe solamente el proxenetismo, que es por lo demás ni idea.

Beating the high frequency traders

MarkletWatch:Here is a typical scenario to show how this works: An asset manager legally discovers better information of a stock than the market does and trades to exploit that information. After the order is filled, a “back-runner” legally observes the institution’s filled order. The back-runner could be an HFT that uses sophisticated pattern recognition software to determine the existence of a large investor trying to buy or sell. The back-runner then competes with the institution by using that order-flow information to its advantage.

In this situation, the HFT has no crystal ball; it cannot see an order before it reaches the market. Instead, the HFT is watching the market all the time looking for patterns that indicate the intention of a large investor, as that suggests that a particular stock is over or undervalued. When the HFT sniffs out a large investor, it can become a competitor with its own transactions, driving the stock price up or down.

The best response of institutional investors is to introduce some “noise,” or the appearance of randomness, to cover their tracks. For example, if the real goal is to buy 100,000 shares, then the investor could include some sells in the mix of transactions to essentially play hide-and-seek with the HFT and mask its true intent. It also could change its buying pattern so that the number of shares per trade and the timing of the trades appear random. This use of randomization makes it riskier for the back-running HFT, as it can’t be certain of the institutional investor’s real plans or even its presence.

I think we knew about this solution for five years, at least since I mentioned it.  This is straight out pf Shannon, first measure the uncertainty level of the market, then trade just outside of that band, breaking up your trade as necessary.   The sad point is how clueless traders are regarding statistics.

Yes, Los Angeles is a housing bubbler

It is the comparison with the national average because the dollar and loan companies are shared throughout the economy.  California has zero population growth, our productivity growth is stagnant, and there is no way we can endogenously afford these prices.  This bubble is driven by Chinese outflow of funds, the rebalancing.  The communists over there are soon forced to rationalize capital flows, and the prices will revert suddenly.

Consider that Texas has also seen this much housing appreciation, up to 9% YoY in Dallas.  Together,  California and Texas are one quarter of the US  average, the blue dotted line above.  So we can that the North East is barely making money on housing.  That is a huge distortion.

Compare cities with the Schiller US housing index.  Most  of the California bubble markets from 2006 are right back up.

Wait until the Texas primary

GOP voters in Nevada are apparently furious with Washington.

"Entrance" polls from NBC News found that Republicans who showed up to participate in the Nevada caucuses on Tuesday were the angriest subset of voters out of the four states that have weighed in on the GOP primary.

Nearly six in 10 — 58% of Republican voters polled on Tuesday as they entered caucus sites — were angry at the federal government.

Trump gets the angry vote, he has the voter pulse like no other candidate.  .  We do not like either party, nor the Swamp, nor the Tea Party. Millennials are better off letting the Swamp go bankrupt and starting over.  Rubio takes his instructions from the party regulars, and he is fairly clueless.  Cruz is more fun, but Trump got the angry vote and it is not going anywhere else.