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Republicans Will Get Slaughtered in 2018 Midterm Elections

By EconMatters

If Elections were held tomorrow, The Democrats would win the Presidential election and the Senate for sure, and maybe even the House of Representatives; it is going to be brutal for Republicans come Midterm Elections. Donald Trump is even hurting the business community with his policy initiatives.

Donald Trump will be slowly isolated in Washington and be a lame duck President in two years, most of the stuff Donald Trump blusters about will never see the light of day. The Global Economy will be in recession, and although he will not have caused it directly, he sure will not have helped the situation with his extreme policy approach, and ultimately he will serve as the easy scapegoat for laying the blame.

At this rate, even the business community will be tired of his dictatorial act, and multiple groups will band together and take him down. He will probably be the most impotent President serving out the last couple years of his term, that`s if he isn`t outright impeached before then. Things are going to get rather ugly given his incompetent cabinet makeup these four years; things are not shaping up good for financial markets and the Global Economy under Donald Trump. Financial Market Participants could not have gotten this more wrong after the election.

They are so completely off sides and unprepared for what is to follow over the next four years. I cannot think of a worse Price and Time Relationship to be this Long as a Market Participant. Given valuations what they are, Central Banks at the end of the Road, and a Global Trade War, with Geopolitical Event Risks off the Charts. And I didn`t even get to the unsustainable debt burdens of governments around the world, the end of the stock buybacks and dividends era, and baby boomers about to take out retirement funds from financial markets to live on for the next decade.

I would have thought that the 2008 Financial Crisis cleaned out a lot of the dead wood, i.e., incompetent money managers from the system in a purge effect, but it appears as if the dead wood was replaced with even stupider investors and more incompetent Dead Wood. The Decision Making, Critical Thinking Skills necessary for making intelligent investment decisions is sure a rare commodity these days in Financial Markets.



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February’s FOMC Meeting: A Powder Keg In Search Of A Match

Authored by Mark St.Cyr,

On February 1st the Federal Reserve will conclude its scheduled two-day meeting. No one expects any change in policy to be announced, especially since the Fed has since hiked rates at the preceding meeting. And with there being no press conference scheduled, that’s been a pretty reliable indicator for all to assume it’s steady-as-she-goes.

Although I agree, what I also believe is there’s a wildcard in this one that could send everything into a tizzy. That “wildcard” is: The minutes.

The minutes (e.g., transcripts of the meeting) are released three weeks after the date of the policy decision. More often than not these are looked upon by the “markets” as “already known, knowns.” In other words, a non-market moving event.

However, I believe this meeting followed by its minutes may set up the “markets” as well as the economy for an “Ides of March” we may all soon not want to remember, let alone – never forget.

So why is it I imply these minutes might have more onerous implications than prior? Two words: China, Yuan.

Let’s lay out a few other “known, knowns”, as well as a possible “what if” and what they might portend after this upcoming Fed. meeting shall we?

As we sit here today it’s hard to overstate what is now coined the “Trumpflation” trade happening across the U.S. “markets.” All the major indexes are trading at never-before-seen-in-human-history-highs.

Even the President himself took to social media to put his stamp (or brand) of approval on Dow 20K. And with that action implied credit for it. Something prior presidents usually kept at arm’s length, accepting credit via osmosis. So to say, think, or believe this president isn’t going to insert himself into the dialogue of the “markets” in the future, for whatever the reason, is naive at best, willfully blind as worst. Because now – you have precedent. This is an important point to remember.

Now on the other hand we have China, and the Yuan. And I believe it’s here where things begin to go awry in very short order.

I will argue both the “markets,” and currencies are about to be caught off guard and left flat-footed in much the same fashion as politicians everywhere have been with the U.S. president. i.e., Completely shocked and stupefied as to the reality of what he’s doing – as compared with what they thought (or believed) he’d do. And he’s only been in office a week.

It is a known fact that China is currently throwing everything (including the kitchen sink) trying to stem capital flight from not only within its borders, but also, a depreciating Yuan exacerbated by a rising $Dollar. And it’s not getting better.

The real problem? It may go from worsening condition to catastrophic at any moment. No hyperbole intended.

China’s latest efforts to halt an ever falling Yuan seems to be waning, along with the ever watched USD/CNH cross rate once again inching back toward prior intervention attempts. Or to say it differently: Without constant, unrelenting, massive intervention – the path is down, and maybe, waaay down.

China’s dilemma is not merely worsened by the ramifications of a “hawkish toned” Fed. That’s an understatement. What I want to make clear from my perspective is this:

In its (China’s) current position, I’m of the opinion they’re one rate hike (U.S. hike to be specific) away from the Yuan becoming completely unglued from any sought level by the politburo, regardless of further intervention – and- goes into an uncontrolled free-fall, exacerbated by capital flight which only may be halted or quelled by some form of monetary martial law.

I’m also of the opinion – it’ll be too little, too late, and the global “markets” will go into a near instantaneous heaving with gyrations possibly worse, if not on par, with the beginning chaos seen in early 2008. And that can all happen (“can” because nobody knows) in the coming weeks. Here’s why:

A lot has changed over the last few weeks. First and foremost: president-elect is now Mr. President. And with that has come sweeping changes to the global stage as to how once thought sacrosanct “trade deals” or “trading partners” have been relegated to “it’s different this time” status. Make that – much, much different.

One of the most stunning developments I personally took notice of was the president’s very public cancelling of a scheduled meeting with Mexico’s president. What I found absolutely comical was the reporting of it by the media through the political lens. Every word I continue to hear, or read, is either in the form of unhinged apoplectic, or utterly confused.

I’m here to tell you the way the president treated that circumstance is absolute “Business 101.” To think this president isn’t more concerned with “business optics first” as opposed to “political optics” is journalistic, as well as political malfeasance.

Any person who is, or has, been in business viewed his response (e.g., Mr. Trump’s) as a textbook business negotiation tactic. i.e., “If we can’t agree that it has to be good for the both of us? Fair enough, thanks for letting us know, all the best: ‘click.’” I personally have used that exact negotiating start point countless times throughout my own career.

I’m going to make this point for it is the key to understanding what truly took place. Not from the political, but rather, from the business perspective:

“Click” means just that: Click, the conversation is over.

If you aren’t already prepared, or at the least cognizant of the consequences – whatever they may be – you don’t use it. It’s not something, or a tactic, to be used flippantly. That’s why it can be one of the most forceful negotiating start-points in business for it implies nothing, rather – it states clearly: “If my phone doesn’t ring, I know it’s you – and don’t care.”

This is for those who aren’t interested in “talking” about a deal. It’s only used by those interested in doing a deal. If not? They’re moving on to someone else who either might or does.

It’s not for the faint-of-heart politician, and that’s why most are already seeking oxygen masks. But serious business people? It’s the only way. Period.

China’s politburo has to now assume that this president is far more serious and willing to accept consequences as to renegotiate prior deals or hash out new ones going forward. Calls of “currency manipulator” or for “tariffs” and more are now squarely on the table going forward. China must now look at any and all possibilities through the lens of having actual follow-through. Why?

By all appearances Mr. Trump is showing when it comes to business – he’s deadly serious. But what may be more important is this: He appears personally prepared and willing to accept or deal with any fallout.  And, once again – that’s Business 101.

It is there dear reader, where the rubber-hits-the-road far differently than ever before when it comes to China. For it might be that the next person Mr. Trump decides to “cancel a meeting” or “tell them I’ll get back to them” is none other than China. A position the China of today has never been in.

This must be causing quite the stir, as well as consternation for China’s leaders behind the scenes as they’re enjoying (or at least trying) their New Year. Why? Because you now have provable actions as to compare or postulate by. i.e., The current “Mexican standoff” must be taken as entirely plausible to happen to them. Regardless of how many (enter your “think” tank of choice here) might argue it as “crazy talk.”

And speaking of “crazy talk.” Let’s get to the Fed. and its upcoming meeting shall we?

As convoluted as the current narrative is to follow of whether or not the Fed. will in-fact begin raising rates in earnest this year. One thing is clear: The Fed. appears to now be by openly hostile to the current administration. Why do I make such a claim? Just look to their own public words for clues.

At the last meeting I made the observation for opinion that if you watched, and listened to the retorts given by Ms Yellen. One couldn’t come away with any other conclusion than what appeared to my eye. i.e., A complete reversal for upcoming policy based purely on the current administration. Data be damned. Not only an I still standing by that claim, I feel more confident in it than ever. Here’s why:

As I stated then: About 60 days prior to that meeting and subsequent rate hike Ms. Yellen gave a speech on how the residual effects from the financial crisis of ’08 had yet to be vanquished and were still present adding to much of the malaise still apparent in the economy. Here thoughts on what to do about it? Maybe a “high-pressure” policy stance would be suitable. What’s that in layman’s terms you ask? Basically it’s this: Keep rates low even while the economy shows improvement and inflation rises, even if it’s above any once “mandated” benchmark.

That was when Mrs. Clinton appeared to be the presumptive winner. When it was president-elect Trump? Raise rates, and vociferously imply not only is an increase of rate hike gone from a well-assumed 2 to 3 in 2017. But what was far more instructive was Ms. Yellen’s responses as to imply more are on the table should they see fit. Don’t take my word for it as I like to point out. Watch the press conference for yourself and come to your own conclusions with what you know now. Including the timing for her purple attire. But I digress.

So here we are today a little more than 30 hence that meeting, and what has now been added into the discussion? Hint: The unwinding of The Fed’s balance sheet.

What’s even more incredible about this story is what the main-stream media and financial media missed, or conveniently glossed over, take your pick. e.g., The inferred revelation that Fed. members are thinking of soon. As in real soon. To wit:

Fed. president Mr. Harker (paraphrasing): “When rates are at 1%, we need to look at unwinding the balance sheet.”

Fed. president Mr. Bullard (paraphrasing): “Balance sheet roll off may be better than aggressive hiking.”

Some will say I’m trying to make an argument that really doesn’t exist, because it’ll be implied as “it’s not like they mean it.” This will be the go-to argument or rationalization by most policy wonk talking heads. However, I use as evidence to back up my assertion with none other than “Mr. Courage To Print, and Print more” former Fed. chairman Ben Bernanke’s own “Wait…what?” response with his own near immediate rebuttal, to wit:

“Has the Fed’s approach to balance sheet normalization actually changed? At least until I hear otherwise from the FOMC’s leadership or the Committee as a whole, my guess (and hope) is that it hasn’t.”

If we’ve learned aything over the last few years “hope” is not a strategy. Especially when it comes to serious matters. So let’s take this all at their word, for that’s why they tell us their “communication strategy for forward guidance” is there for, no? Even if the former chairman is as confused to their intent as the rest of us.

First: “When rates are at 1%, we need to look at unwinding the balance sheet.”

Rates are currently at .5% which implies we are either 1 rate (or Fed. meeting where the old norm of raising .5 or 1/2% begins in earnest once again) away from possibly beginning the once unmentionable (let alone inconceivable) unwinding of the balance sheet. If they decide to do 1/4 points (e.g. .25) raises as has been the norm, then we’re possibly just two meetings away. That’s March 15th aka the Ides of March. (Gotta love the coincidence of history, yes?)

Some will say. “That’s crazy talk.” I’ll contend, as well as argue: The open discussion calling for even a hinting of unwinding the “balance sheet” by the Fed. was also once considered crazy. And yet? There it is.

Second: “Balance sheet roll off may be better than aggressive hiking.”

So let’s put this into perspective: If one rate hike a year has been seen as “the norm.” And if we add to that even 1 has been seen as foreboding dependent on the timing. Is it not fair to conclude the possibility of 3 in a year, added with the Fed. Chair herself arguing maybe even more might be forthcoming should the FOMC decide as – “aggressively hiking?” Notwithstanding being in concert this argument began with someone who made financial heads scratch everywhere when he himself aggressively switched just last year from a “hawkish” perspective to near “uber-dove?”

Again, taken at face value the only prudent consideration is for one to position (or at least calculate in earnest) for the possibility that the Fed. may in fact decide to push much, much faster, and in ways once considered unimaginable, not in years to come – but starting as early as February.

Think that through once again, for if that’s not implying “it’s different this time?” Nothing is.

So with the above for context here’s the real issue: China has to be looking at all the above from behind closed doors – and be absolutely freaking out!

And yes, I mean that precisely, consider it a new “technical term” in response to the current state of affairs and messaging which they can only try to understand, let alone formulate contingency plans for. Remember, they are truly a command and control economy and government. e.g., Communist regime. They don’t have the business savvy for nuance and theatre as we have here.

This is a very dangerous point for the global economy and “markets, let alone for the Chinese politburo. Remember: For all intents and purposes they (the Chinese politburo) view everything via the lens of “a hammer in want of a nail.” And while looking at the above through that prism, they may feel the only thing for them to do is “pound, and pound now.” Remember the line I liked to quote from the movie Margin Call, “It’s not panicking if you’re first.”

Since July of 2016 things have not gotten better for China.

As of today the only thing that has worked as to stem the tide of the Yuan falling ever fast and further into oblivion is utilizing the proceeds via the aggressive selling of currently held U.S. debt. (So far the latest best guess has been well over $1TRILLION)

And here you have multiple Fed. members openly stating it may, in concert, with an aggressive (there’s that word again) raising of rates be looking to, or advising for, purging some of its balance sheet (and by how much is anyones guess although one has to assume it may be more than anyone thinks let alone believes).

All of which if it were to happen (and you have to assume, as well as position that it is a possibility) would be vying for the same buyers for debt as you (e.g., China), and would cause a flooding of the “markets” with purchasable debt into too few buyers with the resources to consume it all, exacerbating what would already be problematic to begin with.

If China feels that it is in a no-win situation (and it’s easily conceivable using the Fed’s latest words, speeches, shift in policy signaling and a whole lot more) They might decide after coming back from their New Year holiday and – act first – question later.

Once the February 1st FOMC meeting concludes – if – the chatter now apparent and public by Fed. members continues during the interlude before the releasing of the minutes, I feel another of the “first to act” will be Mr. Trump in a calling out of epic proportions for hypocrisy using, and pointing to, a very defendable position using the Fed’s own prior testimony, signaling, and more to publicly make his case. Especially if the “markets” begin roiling.

During that time I believe China will wait for the minutes to be released, and if it is made apparent that there was indeed further discussion as to bolster the inferences that the Fed. may be actively considering a path as to embark on a march towards higher rates, along with the thinning of its balance sheet, which would inevitably send the $Dollar rocketing skywards?

They’ll act first and ask (or maybe not) questions later. Sending everything that is now taken for granted in the “markets” (e.g., “It’s good to be long!) into total chaos. All before March 15th’s next meeting. Again, which just so happens to be the exact date originating the “Ides of March” warning.

As I implied in the headline: This “powder keg” may not wait until then. For “then” (March) may be a moment too late. (Just ask Caesar)

Circumstances are now showing this “powder keg” could in fact become – self-combusting. All courtesy of The Fed’s own words whether, stated, implied, written, or imagined.

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RBC: “It Is Crazy What Is Going On ‘Under The Hood’ When On The Surface It’s So Optically Calm”

Having cautioned that the economic macro surprise rally of the past three months…

… has been mostly based on the back of “soft data” surprises, in other words, hope and moistly animal spirits, which “are driving the bulk of the US data surprises”…


… today, RBC’s head of cross-asset strategy Charlie McElligott looks at the first sharp selloff, coupled by a vol spike and observes that one week after the first Trumpflation jitters, the Trump trade on Monday appears to be losing policy momentum, and as a result “profit-taking of longs ensues.”

As McElligott notes, it has been an agitated market to start the week, with VIX seeing its largest intraday move so far in 2017 as we see thematic winners of the past three months being unwound.

It’s not a puke just yet, as we are “still not getting that ‘FTQ’ bid we’d come to expect in the old “risk-OFF” regime, with USTs (and Dollar) essentially unch.  This says to me that it is STOCKS which have discounted the most +++ inputs of potential Trump policy (see last Wednesday’s price-action), and is thus the most ripe for a re-pricing of his ability to ‘steady the ship’ with suddenly-waning policy momentum.

The good news for bulls hoping that BTFD will quickly reemerge, is that much of this move is long overdue, and is likely not the precursor of a sharp move lower:

today’s story feels much like that overdue selloff with nervy profit-taking and some recent risk “renters” tapping quickly on tight-stops.  From a ‘sustainability of the drawdown’ perspective, this quick blast of volatility off of a historically low-base isn’t enough to trigger much if any mechanical deleveraging from the mechanical ‘vol control’ community in-and-of itself, with 20 day S&P historical vol still sitting (laughably) with a 7-handle.”

Unless, of course, it is.

So what does the RBC strategist say to expect from markets in the coming days? The following 4 points summarize his views:

1) Stocks—much more so than FX or rates—are the asset-class bearing the majority brunt of this weekend’s chief geopolitical consternation.  It ‘seems’ that the discombobulated implementation of Trump’s immigration orders has ‘furthered’ the market concerns on protectionism and the potential for Trump’s usage of “executive orders”  to have “jumped the shark” just a few weeks into his tenure.  The growing list of fellow-Republicans lashing-out at the immigration order—as well as the obvious lack of cohesion with the messaging even with the Trump administration–are raising concerns on ‘lost momentum’ with regards to what the stock market really wants from POTUS: tax policy clarity.  As stocks have been the area “quickest” to discount expectations of lower corp tax rates, they “wear it” when markets now begin to reprice Trump’s ability to “get deals done.”

As has been stated over the past week in “RBC Big Picture” there is now growing speculation that the tax plan won’t be clarified until well through the Summer (Reuters this weekend, especially as the ‘funding’ side of a BAT remains yet to be seen—which means it currently isn’t ‘revenue neutral’ which is a demand from many GOP lawmakers.  As forward earnings estimates are increasingly-contingent upon the ‘corp tax rate cut’ and ‘dereg’ components of his policy, there is thus mounting nervousness about recent buyers at all-time highs in US stocks turning tail (note: Asset Managers are now notionally long $80B of US equity futures <S&P, Nasdaq, Russell and Dow>, making year-and-a-half cumulative highs) if ‘reality’ weren’t to meet the heavy ‘expectation’ on policy which has been incorporated into current pricing.

* * *

2) Today’s particulars show something interesting: both the thematic “reflation” and “Trump winners” (most clearly expressed in 4Q16—border tax beneficiaries, dereg beneficiaries, infrastructure beneficiaries, security beneficiaries, domestic-gearing beneficiaries) and 1Q17’s “mean-reversion” leaders are under pressure.  This means that today we see both the “‘cyclical beta’ / ‘small cap’ (large IWM downside trades today) / ‘value’ / ‘high beta’” cohort is trading-off IN CONJUNCTION WITH “‘secular growers’ / ‘momentum’” Q1 leadership selling-off as well (tech sector specific concerns on H1-B impact for workers).  What is working should of course not surprise: ‘low vol’ / ‘quality’ / ‘defensives’ / ‘anti-beta.’  Basically, longs are being sold while shorts are added / pressed—thus, today is NOT a ‘gross-down’ or ‘wholesale de-risking’ day.  

Less tactically / away from the ‘now’ of today’s ugly tape…

* * *

3) As has been discussed since mid-December—when anticipation of a “January Effect” saw funds putting on “reversal strategies” in equities factors earlier than usual—“Growth” and “Momentum” factors have been significant outperformers, with both leading all factor market-neutral strategies YTD.  The interesting thing here is that this comes following 2016 where “Growth” and “Momentum” were the two worst-performing factor m/n strategies YTD…confirming another victory for the January mean-reversion strategy.

More granularly, the performance of “Growth” has helped drive the large YTD gains in Tech and Consumer Discretionary sectors against lagging (former high-flyer) “Value” and “Anti-Beta” factor m/n (representing cyclicals and defensives, respectively).  The performance of 1m “Momentum” factor m/n would reasonably reflect this same “Growth vs Value” reversal, as ‘momentum longs’ are led by Tech, Materials (S&P’s best performing sector YTD), Consumer Disc and Industrials, while ‘momentum shorts’ are heavily represented by Cons Disc as well as Healthcare, Tech and Energy (S&P’s worst performing sector YTD, after being last year’s “value” darling). 

This also highlights the significant move higher in dispersion (or correlation breakdown) as we see sectors representing across both momentum leaders and laggards.

* * *

4) On that note, an interesting anecdote picked-up from an astute client and friend this weekend regarding the extreme nature of increasing single-stock dispersion currently being experienced in the market-place, which I will paraphrase: For over the last month plus, watching our portfolio grind higher it feels like 10- to 20- some basis points on the majority of days, which seems kinda sleepy…but when I look at the individual names in our long and short books, I am seeing HUGE moves daily.  Both books at times are riddled with many stocks seeing 2 and 3 standard deviation moves….it is CRAZY what is going on “under the hood,” when on the index level, it’s so optically calm.” 

Idiosyncratic stock-risk is returning, and that is a sign of a market normalizing from years of central bank volatility suppression = score one for active management.

* * *

While that would be great news for hedge funds if true, we look forward to learning from bulge bracket prime brokers in a few days time if hedge funds finally managed to outperform the S&P, or if 2017 has started off in familiar fashion, with the “smart money” once again nothing but heavily levered beta.

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Flashback 2006: Senators Clinton & Obama Vote For Secure Fence Act, Bush Signs Bill

Submitted by Michael Shedlock via,
Inquiring minds are taking a flashback look at the Secure Fence Act of 2006, signed by president Bush.
The Secure Fence Act of 2006’s goal is to help secure America’s borders to decrease illeg…

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Obama Makes First Statement Since Leaving White House, Supports Protests Against Trump Policy

It took Obama ten days since he departed the White House one final time to break his promise that he would “stay on the sidelines” regarding Trump’s policies…

Earnest says Pres Obama wants to afford his successor the same customs and courtesies he received from Pres GWBush – staying on sidelines.

— Mark Knoller (@markknoller) January 4, 2017

… and in his first public statement, the former president the charge that the Trump administration had based his immigration executive order on a policy adopted by his own administration, and endorsed the protests that have been taking place across the country in response to the new restrictions.

Kevin Lewis, Obama’s spokesman, said rejected Trump’s insistence that the decision to temporarily halt refugees from seven Muslim-majority countries and stop all Syrian refugee resettlement in America is similar to a 2011 decision by Obama. “With regard to comparisons to President Obama’s foreign policy decisions, as we’ve heard before, the President fundamentally disagrees with the notion of discriminating against individuals because of their faith or religion.”

As a reminder, over the past 24 hours, Trump has compared his actions to Obama’s 2011 moves to restrict entries from Iraq after two Iraqis were arrested in Kentucky on terrorism charges.

Former Obama administration officials have denied that there was ever a halt to the awarding of visas to Iraqis, though the processing of these applications slowed after they were subject to more intense scrutiny.

Obama’s decision to step back into the public light comes just 10 days after he left office. He joins the chorus of Democrats and mostly tech CEOs criticizing Trump for his decision to temporarily halt refugees from seven Muslim-majority countries and stop all Syrian refugee resettlement in America.

Obama also encouraged ongoing protests against Trump’s immigration policies: “President Obama is heartened by the level of engagement taking place in communities around the country. In his final official speech as President, he spoke about the important role of citizen and how all Americans have a responsibility to be the guardians of our democracy–not just during an election but every day,” Lewis said.

“Citizens exercising their Constitutional right to assemble, organize and have their voices heard by their elected officials is exactly what we expect to see when American values are at stake.”

As The Hill notes, former presidents often give their replacements a wide berth in office, rarely weighing in to criticize their actions out of respect for the office. While Obama served as a vocal critic to Trump on the campaign trail, he told reporters during a trip to Peru last November that he wanted to give Trump the chance to lead without Obama “popping off.”

But Obama added that he wouldn’t unilaterally remain quiet, and today he held true to that loophole.

“As an American citizen who cares deeply about our country, if there are issues that have less to do with the specifics of some legislative proposal or battle, but go to core questions about our values and our ideals, and if I think that it’s necessary or helpful for me to defend those ideals, then I’ll examine it when it comes,” Obama said.

The full statement from Kevin Lewis, spokesperson to Former President Barack Obama, is below:

President Obama is heartened by the level of engagement taking place in communities around the country. In his final official speech as President, he spoke about the important role of citizen and how all Americans have a responsibility to be the guardians of our democracy–not just during an election but every day.


Citizens exercising their Constitutional right to assemble, organize and have their voices heard by their elected officials is exactly what we expect to see when American values are at stake.


With regard to comparisons to President Obama’s foreign policy decisions, as we’ve heard before, the President fundamentally disagrees with the notion of discriminating against individuals because of their faith or religion.

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Kellyanne Conway Rages Against “Misinformation” Over Trump’s Immigration Order

After exposed Obama, Bush, and Clinton’s previous anti-immigration actions amid the backlash against President Trump’s executive orders, administration senior adviser Kellyanne Conway appeared on CNBC this morning and was visibly angry at the “information underload” from the mainstream media and bullhorn-touting, crying politicians.

“The media and politicians have an obligation to calm the public [with facts] about what this policy does, and more importantly does not, do… this is why [Trump] has to tweet, so that the media will cover the tweet [facts]”

It’s pretty clear Conway’s frustration is growing (and who can blame her)…

Additionally, in an effort to dispel some more misinformation, Breitbart offers seven inconvenient facts about Trump’s refugee actions…

1. It is NOT a “Muslim ban.” You will search the Executive Order in vain for mentions of Islam, or any other religion. By Sunday morning, the media began suffering acute attacks of honesty and writing headlines such as “Trump’s Latest Executive Order: Banning People From 7 Countries and More” (CNN) and printing the full text of the order.

Granted, CNN still slips the phrase “Muslim-majority countries” into every article about the order, including the post in which they reprinted its text in full, but CNN used the word “Muslim,” not Trump. The order applies to all citizens of Iraq, Iran, Syria, Libya, Somalia, Sudan, and Yemen. It does not specify Muslims. The indefinite hold on Syrian refugees will affect Christians and Muslims alike.

As Tim Carney at the Washington Examiner points out, the largest Muslim-majority countries in the world are not named in the Executive Order.

More countries may be added to the moratorium in the days to come, as the Secretary of Homeland Security has been instructed to complete a 30-day review of nations that don’t provide adequate information for vetting visa applicants.

It’s also noteworthy that the ban is not absolute. Exceptions for “foreign nationals traveling on diplomatic visas, North Atlantic Treaty Organization visas, C-2 visas for travel to the United Nations, and G-1, G-2, G-3, and G-4 visas” are expressly made in the order. The Departments of State and Homeland Security can also grant exceptions on a “case-by-case basis,” and “when in the national interest, issue visas or other immigration benefits to nationals of countries for which visas and benefits are otherwise blocked.”

There is a provision in the Executive Order that says applications based on religious persecution will be prioritized “provided that the religion of the individual is a minority religion in the individual’s country of nationality.”

This has been denounced as a “stealth Muslim ban” by some of the very same people who were conspicuously silent when the Obama administration pushed Christians – who the most savagely persecuted minority in the Middle East, with only the Yazidis offering real competition — to the back of the migration line.

2. The order is based on security reviews conducted by President Barack Obama’s deputies. As White House counselor Kellyanne Conway pointed out on “Fox News Sunday,” the seven nations named in Trump’s executive order are drawn from the Terrorist Prevention Act of 2015. The 2015 “Visa Waiver Program Improvement and Terrorist Travel Prevention Act of 2015” named Iraq, Iran, Sudan, and Syria, while its 2016 update added Libya, Somalia, and Yemen.

“These are countries that have a history of training, harboring, exporting terrorists. We can’t keep pretending and looking the other way,” said Conway.

3. The moratorium is largely temporary. Citizens of the seven countries named as security risks are banned from entering the United States for the next 90 days. Refugee processing is halted for 120 days. The longest-lived aspect of the ban may prove to be the halt on Syrian refugees, but that isn’t given a time frame at all. It will last “until such time as I have determined that sufficient changes have been made to the USRAP to ensure that admission of Syrian refugees is consistent with the national interest,” as President Trump wrote.

4. Obama banned immigration from Iraq, and Carter banned it from Iran. “Fact-checking” website PolitiFact twists itself into knots to avoid giving a “true” rating to the absolutely true fact that Jimmy Carter banned Iranian immigration in 1980, unless applicants could prove they were enemies of the Khomenei theocracy.

One of Politifact’s phony talking points states that Carter “acted against Iranian nationals, not an entire religion.” As noted above, Trump’s Executive Order is precisely the same – it does not act against an “entire religion,” it names seven countries.

As for Barack Obama, he did indeed ban immigration from Iraq, for much longer than Trump’s order bans it from the seven listed nations, and none of the people melting down today uttered a peep of protest. Richard Grenell summed it up perfectly in a Tweet:

Obama took 6 months to review screening for 1 country. Trump will take 3 months for 7 countries. #MAGA @realDonaldTrump

— Richard Grenell (@RichardGrenell) January 29, 2017

 5. Trump’s refugee caps are comparable to Obama’s pre-2016 practices:  David French, who was touted as a spoiler candidate to keep Donald Trump out of the White House during the presidential campaign – in other words, not a big Trump fan – wrote a lengthy and clear-headed analysis of the Executive Order for National ReviewHe noted that after the moratorium ends in 120 days, Trump caps refugee admissions at 50,000 per year… which is roughly the same as President Obama’s admissions in 2011 and 2012, and not far below the 70,000 per year cap in place from 2013 to 2015.

Obama had fairly low caps on refugees during the worst years of the Syrian civil war. He didn’t throw open the doors to mass refugee admissions until his final year in office. Depending on how Trump’s review of Syrian refugee policy turns out, he’s doing little more than returning admissions to normal levels after a four-month pause for security reviews.

6. The Executive Order is legal: Those invoking the Constitution to attack Trump’s order are simply embarrassing themselves. The President has clear statutory authority to take these actions. As noted, his predecessors did so, without much controversy.

Most of the legal arguments against Trump’s order summarized by USA Today are entirely specious, such as attacking him for “banning an entire religion,” which the order manifestly does not do. Critics of the order have a political opinion that it will in effect “ban Muslims,” but that’s not what it says. Designating specific nations as trouble spots and ordering a pause is entirely within the President’s authority, and there is ample precedent to prove it.

It should be possible to argue with the reasoning behind the order, or argue that it will have negative unintended consequences, without advancing hollow legal arguments. Of course, this is America 2017, so a wave of lawsuits will soon be sloshing through the courts.

7. This Executive Order is a security measure, not an arbitrary expression of supposed xenophobia. Conway stressed the need to enhance immigration security from trouble spots in her “Fox News Sunday” interview. French also addressed the subject in his post:

When we know our enemy is seeking to strike America and its allies through the refugee population, when we know they’ve succeeded in Europe, and when the administration has doubts about our ability to adequately vet the refugees we admit into this nation, a pause is again not just prudent but arguably necessary. It is important that we provide sufficient aid and protection to keep refugees safe and healthy in place, but it is not necessary to bring Syrians to the United States to fulfill our vital moral obligations.

French’s major objection to the Executive Order is that applying it to green-card holders is “madness,” but unfortunately many of the terrorists who attacked Americans during the Obama years were green-card holders. Daniel Horowitz and Chris Pandolfo addressed that subject at Conservative Review:

Both liberals and conservatives expressed concern over hundreds of individuals going over to fight for ISIS. We are already limited in how we can combat this growing threat among U.S. citizens. Given that it is completely legal to exclude non-citizens upon re-entry, Trump extended the ban to legal permanent residents as well.


If a Somali refugee is travelling back to Somalia (so much for credible fear of persecution!), government officials should have the ability to prevent that person from coming back when necessary. Obviously, there are some individuals from these seven countries who already have green cards and we might not want to exclude. That is why the order grants discretion to the State Department to issue case-by-case exemptions for “religious persecution, “or when the person is already in transit and denying admission would cause undue hardship.” A CBP agent is always stationed at any international airport from which these individuals would board a direct flight to the United States (Paris and Dubai, for example). That individual would not allow anyone covered by this ban onto a U.S.-bound flight unless he grants them a hardship exemption.

Indeed, it appears that green card holders returning yesterday from those seven countries were all granted entry.

Because he is a progressive globalist, Obama deliberately blinded us to security threats, in the name of political correctness and left-wing ideology. Ninety or 120 days isn’t much time for Trump to turn all that around, especially because it is unlikely much will change in the seven countries Trump named.

The hysterical reaction to Trump’s order illustrates the very thing that worries advocates of strong immigration security: Americans’ security is the lowest priority, far below progressive ideology, crass political opportunism, and emotional theater.

We’re being effectively told by the theatrical class to tolerate a certain amount of Islamic terrorism because their feelings would be hurt by the tough measures we need protest ourselves from a tough enemy. But this time, President Trump is proving tough enough to push our security up into the top priority.

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