Sunday, January 21, 2018

MONDAY 1/22/18; BOJ Begins 2-Day Policy Meeting; US Government Shutdown Day Three; HAL; UBS; Chicago Fed Activity Index; NFLX; AMTD; STLD; ZION

Euro 1.2262. The euro pops +0.3% after the German SPD Party votes to begin formal coalition talks with Chancellor Merkel. Euro/yen 135.64. Dollar/yen 110.62. Pound 1.3893. Sterling is back under 1.39. Euro/pound 0.8827. Mexican peso 18.613. Canadian dollar 1.2479. Dollar/yuan 6.404. Indian rupee 63.8462. Aussie dollar 0.8001. USD 90.51. Bitcoin 11323.

WTIC oil 63.37. Brent oil 68.61. Natty gas 3.19. Gold 1332. Silver 17.04. Copper 3.1875.

Treasury yields are; 2-year 2.07%, 5-year 2.45%, 10-year 2.66%, 30-year 2.93%. The 2-10 spread is 59 bips.

Aussie and Asia stocks begin trading mixed. The ASX 200 is up +0.2%. The NIKK is soggy trading marginally lower. South Korea’s KOSPI sinks -0.4% with tech stocks dragging the key index lower.

Asia traders are monitoring developments in the US government shutdown drama. Global investors remain sanguine over the shutdown as reflected in mixed markets in Asia and US futures only marginally lower.

S&P -5. Dow -42. Nasdaq -7. Russell -5. In the opening minute of futures trading, the S&P dipped to -8 and Dow -90. Markets are calm since traders are used to the drama, theatrics and political baby games in Washington, DC. Traders expect the weasel politicians to come to an agreement quickly to end the government shutdown.

The Senate hoped to vote late Sunday evening in the States or in the early morning hours this morning on a spending bill to halt the shutdown, but the republicans and democrats continue negotiations. The Senate says a vote to advance a short-term spending bill will take place at noon Monday (12 PM East Coast time; 5 PM London; 6 PM Frankfurt and Paris; 2 AM Tuesday morning Tokyo).

The democrats may be caving retreating from their position on immigration. Republican Senate Majority Leader McConnell appears agreeable to addressing issues such as immigration, disaster relief, healthcare and military spending in future bills but his assurances may not be enough to win over democrats. The two parties do not trust each other. Washington, DC, became more partisan and divided under President Obama’s watch and the situation is exacerbated under President Trump. The republican tribe talks past the democrat tribe and visa versa.

The US government shutdown began on Friday night at midnight and is now in day three. The situation becomes more serious as the workweek begins since government employees will not report to work this morning. Paychecks will be delayed. Businesses that support government activity will be hurt. There will be confusion, political drama and uncertainty.

The focus will be on the proposed Senate vote at 12 noon EST. If the spending bill is approved by the Senate, the House will also have to approve the measure (which will probably not be a big deal). Keep in mind, that even if a deal is approved it only kicks the can into February so the drama will continue.

Oil prices are buoyant after OPEC and Russia present a unified front in continuing the oil production curbs well through this year. As would be expected, they downplay the impact of North American shale oil production. Oil prices are marginally higher. WTIC 63.50. Brent 68.72. Natty 3.25. Gold 1335. Silver 17.07. Copper 2.181.

The BOJ begins a two-day policy meeting with an announcement planned for tomorrow. The Bank of Japan is expected to maintain existing monetary policy unchanged. The ECB policy meeting is the major market event this week on Thursday morning. King Draghi is picking up his velvet cape at the cleaners and is ready to don his jeweled crown and decree how markets should trade this week. The central bankers are the market.

In Japan, Mitsubishi Motors drives +1.7% higher but Toyota sputters -0.8%. SoftBank +1%. Sony +1.1%. Toshiba +4.4%.

In South Korea, tech stocks are soggy creating weakness in the KOSPI. SK Hynix -3%. Samsung Electronics -2.2%. LG Display is a bright spot up +1%. The chatter continues concerning Apple iPhone shipments from suppliers that may be slightly missing expectations. Steelmaker Posco loses -2.1%.

Aussie banks are weak with Commonwealth down -1.2% and the banking sector index down -0.8%. NAB -0.6%.

Chinese equities trade higher led by gambling stocks. SSEC +0.2%. HSI +0.3%. Sands China +3.5%. SJM +4.5%. Tencent +1.3%. HSBC -0.3%.

Chinese conglomerate HNA crashes -10%. HNA has been buying up several companies in diversified industries and needs to digest the acquisitions. Liquidity issues are surfacing. Enron was a conglomerate and acquisition giant that got into trouble in the States in the late 1990’s during the dotcom bubble; its collapse created weakness in the US stock market.

The euro retreats off the highs and trades at 1.2225 at levels similar to last week. The US dollar index moves higher to 90.62. The euro and dollar are settling into a sideways pattern to begin the week.
India stocks are trading higher. The Nifty is up 13 points, +0.1%, to 10907. The BSE Sensex gains 112 pints, +0.3%, to 35623.

The NIKK ends the session flat at 23816. The ASX 200 finishes down -0.2% at 5992. The KOSPI ends down -0.7% to 2502. The SSEC rallies +0.4% to 3501. Chinese traders buy the blue chips with both hands. CSI300 rallies +1.3%. Hong Kong’s HSI gains +0.4% to 32393.

South Korea is the loser with traders taking profits at the record highs. Chinese stocks are the winners overnight always receiving help from the PBOC. The dollar/yuan currency pair drops to 6.4048 so the PBOC is intervening to prevent the yuan from strengthening too much. The central bankers are the market.

Stock market analysts remain bullish. JPM strategist Nandini Ramakrishnan remains a bull expecting more record highs for stocks ahead. She says wage growth should be moving higher which will boost inflation. Ramakrishnan proclaims that earnings will continue rising so there is “no reason to sell.”

At 3 AM EST (8 AM London; 9 AM Central Europe), European indexes begin trading flat. The DAX is flat after the SPD vote yesterday. CAC -0.1%. FTSE -0.2%. IBEX +0.2%. Auto parts, insurance and tech stocks lead higher. Food and beverage stocks are weak.

Sanofi drops -2.3%. Sanofi makes an acquisition of blood drug company Bioverativ for $11.6 billion that is not received well by investors. Novo Nordisk +0.6%. Shire +0.7. Unilever -0.6%. Richemont takes over control of Yoox Net-A-Porter that jumps +24%. Ocado +10%.

Deutsche Telekom rises +1.5% proclaiming a “5G revolution.” British American Tobacco -0.7%. Prudential -0.5%. BHP -1%. Rio Tinto -0.7%.

UBS sinks -2.7% after earnings and a buyback announcement cannot even help the stock price. Banco Santander +0.3%. A major investor is buying Barclay’s stock boosting the share price. BCS +0.9%. HSBC -1%.

The UK government is proposing restrictions on gambling. William Hill rolls snake eyes and crashes -11%. Ladbrokes crashes -12%. GVC Holdings -5.3%.

Euro 1.2239. Euro/yen 135.58. Dollar/yen 110.78. Pound 1.3891. Euro/pound 0.8810. Mexican peso 18.6001. Canadian dollar 1.2471. Dollar/yuan 6.4055. Indian rupee 63.7912. USD 90.63.

US Treasury yields are; 2-year 2.06%, 5-year 2.44%, 10-year 2.64%, 30-year 2.92%. German bund 0.56%. German yields lose a tick or two in yield to begin the day.

WTIC oil is up +0.3% to 63.57. Brent oil gains +0.4% to 68.84. Natty gas is up +2% to 3.25. Gold 1331. Silver 1.00. Copper is up +0.8% to 3.212.

S&P -5. Dow -50. Nasdaq -8. Russell -4. VIX 11.59.

In Germany, the 600 delegates in the SPD party vote to begin formal coalition talks with Merkel’s party. Chancellor Merkel is relieved but there remains a rocky road ahead explaining the flat moves in the euro and DAX. Once the government coalition framework is finalized, the 400,000 SPD party members will vote on the plan in a couple weeks. This major test will impact Germany’s future. Perhaps market participants are waiting for that drama to play out. Nonetheless, Germany is on a steadier path to begin the week so Merkel is pleased.

At 3:20 AM EST, 20 minutes into European trading, DAX +0.1%. CAC -0.1%. FTSE -0.1%. MIB -0.3%. IBEX +0.1%. PSI +0.1%. UBS sinks -3.3%. William Hill -14%. European travel and leisure stocks are moving lower as the gambling stocks sink.

S&P -4. Dow -48. Nasdaq -5. Russell -4. VIX 11.58. India’s Nifty is up 36 points, +0.3%, to 10931.

At 4 AM EST, S&P -4. Dow -55. Nasdaq -5. Russell -3. VIX 11.60.

DAX -0.1%. CAC -0.2%. FTSE +0.1%. MIB +0.1%. IBEX +0.3%. PSI +0.4%. SMI -0.4%. OMX -0.1%. Switzerland leads lower as the world’s elite and business news networks begin arriving in Davos for the World Economic Forum. Heavy snows have fallen in the Alps. Spain and Portugal catch a bid so the Iberian Peninsula leads Europe higher.

Euro 1.2248. Dollar/yen 110.79. Pound 1.3899. Sterling teases 1.39 again. USD 90.52.

Treasury yields are; 2-year 2.06%, 5-year 2.45%, 10-year 2.65%, 30-year 2.92%. German bund 0.577%. UK gilt 1.36%. Japan 10-year yield 0.076%. France 10-year yield 0.85%.

WTIC oil 63.57. Brent oil 68.72. Natural gas 3.25. Gold 1332. Silver 17.03. Copper 3.213.

The morning continues….

HAL…. earnings …..UBS

The Chicago Fed National Activity Index is

At 9:30 AM EST, US stocks begin trading

At 11:30 AM EST (4:30 PM London; 5:30 PM Central Europe), European stocks finish the session

The DAX

At 4:00 PM EST, US stocks end the day

The SPX

After the closing bell, NFLX AMTD STLD ZION

SUNDAY 1/21/18; US Government Shutdown Day Two; Germany’s SPD Votes on Coalition Government; Turkish Troops Invade Northern Syria

The US government shutdown continues for the second day. The republicans and democrats will be spinning the situation on the Sunday morning talk shows.

Lawmakers continue meeting to resolve the shutdown. The latest proposal is to kick the can down the road until 2/8/18 which is only 17 days away. The incompetency of the Washington , DC, bureaucrats is jaw-dropping.

The politicians only care about the blame game and nothing else. Who is receiving the blame for the government shutdown? Usually it is the republicans. President Trump takes a hardline against the democrats saying there will be no talks on immigration reform unless they start paying the military and other first responders so the shutdown is at a stalemate. Trump must be confident that the “Schumer Shutdown” moniker will stick and the democrats will receive the blame.

In the overnight hours, the #SchumerShutdown hashtag on Twitter has been tweeted 1.2 million times. The #TrumpShutdown hashtag has been tweeted 2.6 million times double the #SchumerShutdown. President Trump may want to rethink his strategy and back off his hardline approach since it appears that the republicans are receiving far more of the blame for the shutdown as is what typically occurs.

The flu season in America this winter is worse than average. 32 people under 65 years old died from the flu last week. The death count rises to 74 under the age of 65 for the flu season thus far. California is hit particularly hard. The flu vaccine is only 10% to 30% effective this year and many Americans do not believe in taking flu shots since they contain the preservative Thiomeresal that exposes the body to mercury.

In Germany, the SPD (Social Democrats), the opposing party to Chancellor Merkel’s CDU (Christian Democrats), votes on whether to enter a coalition government with Germany’s leader. The SPD is a center-left party and Merkel’s CDU is center-right. The CSU (Christian Social Union) partners with the CDU. Merkel is hoping for a positive result saying that it is “vital that Germany has a stable government.”

Martin Schulz, that leads the SPD, tells Der Spiegel magazine, “If the party rejects a coalition it will lead to new elections, and fast.” Merkel’s fate and the stability of Germany hangs in the balance. The 600 SPD key members begin voting. Either Germany forms a grand coalition today or the country collapses into a political, and perhaps economic, crisis.

Global investors will be focused on the United States government shutdown drama and Germany’s coalition government saga as the new trading week begins. The business news media will also be fixated on the World Economic Forum in Davos this week.

Vice President Pence continues the Middle East trip traveling from Egypt to Jordan to meet with King Abdullah. Pence and wife Karen enjoy lunch with King Abdullah and Queen Rania. Pence next flies to Israel.

In a troubling development in the Middle East hornet nest, Turkish forces begin a military operation into northwest Syria attacking Kurdish forces. The US supports the Kurdish forces with weapons since that are very instrumental in defeating the Islamic State radicals. Turkey, however, feels threatened by the Kurds that have long had their eyes on Turkish territory.

Turkey President Erdogan is increasingly hostile to the United States and plans to create a 30 km (19 miles) buffer zone inside Syria along its border to keep Kurdish forces at bay. Turkey is flying its F-16’s on bombing runs and Turkish tanks are in Syria.

Euro 1.2222. Euro/yen 135.45. Dollar/yen 110.77. Pound 1.3858. Euro/pound 0.8818. Mexican peso 18.6353. Canadian dollar 1.2793. Dollar/yuan 6.404. Indian rupee 63.8462. Aussie dollar 0.7995. USD 90.666.

WTIC oil 63.37. Brent oil 68.61. Natural gas 3.19. Gold 1332. Silver 17.04. Copper 3.1875. Platinum 1017. Palladium 1099.

Treasury yields are; 2-year 2.069%, 5-year 2.453%, 10-year 2.661%, 30-year 2.933%.

Global 10-year yields are; Brazil 9.87%, Mexico 7.55%, India 7.29%, Greece 3.76%, New Zealand 2.95%, Australia 2.86%, US 2.66%, South Korea 2.63%, Canada 2.23%, Singapore 2.12%, Italy 1.95%, Portugal 1.95%, Hong Kong 1.88%, Spain 1.43%, UK 1.34%, France 0.84%, Netherlands 0.60%, Germany 0.56%, Japan 0.07%, Switzerland -0.05%.

Mexico and India are at parity. The United States and South Korea are at the same yield level. Italy and Portugal are at parity. Portugal yields were higher than Italy and then that reversed over the last couple months and now both nations are tracking together. The key European peripheral nations Greece, Italy, Portugal and Spain are in the 1.43% to 3.76% range for the 10-year yield.

Germany’s 10-year bund yield moves up to greet the Netherlands at that 0.60%-ish level. The BOJ continues its yield curve control policy with the 10-year yield at 0.07%. Switzerland remains negative with investors fully willing to pay the Swiss for the privilege of parking their money in the Alps. They can visit their dough when they attend the World Economic Forum in Davos this week.


The Senate plans to convene at 1 PM and House at 2 PM. The Statue of Liberty and Ellis Island is closed due to the shutdown, however, Congress continues to get paid. The Senate releases news that it may vote on a three-week spending bill at 1 AM EST Monday morning. The Sunday morning political talk-show mud-slinging begins.

In the afternoon, Senate Majority Leader McConnell (republican) talks on the floor and blames the democrats for the shutdown. One-half hour later, Senate Minority Leader Schumer (democrat) speaks on the floor and blames the republicans.

At 3 PM EST, there is encouraging news that democrats and republicans are talking and may be able to resolve the government shutdown. The Senate plans a vote at 1 AM EST. The politicians are trying to stop the shutdown before everyone has to show up for work on Monday morning. It may be a long night ahead for the beltway politicians but not one American will be shedding a tear for any of them.

The 600 German SPD party members vote to enter formal talks to form a coalition government. Chancellor Merkel is relieved as the four-month stalemate begins to resolve. The euro pops +0.3% higher to 1.2262.

Friday, January 19, 2018

SATURDAY 1/20/18; US Government Shutdown Occurs Day One

The US government shutdown occurs at 12:01 AM EST which is surprising. The weasel politicians typically make an eleventh hour deal. The stock market was completely sanguine about the potential shutdown yesterday printing new all-time record highs with traders fully expecting a funding bill to be approved last evening. It was not.

The House-passed funding bill that would have averted a government shutdown dies in the Senate. The blame game begins. The democrats say the republicans are at fault since they control all three branches of government; the presidency, the House and the Senate. The democrats also want a deal on immigration.

The republicans call the democrats obstructionists and say the democrats want to make the president look bad. President Trump calls the event the “Schumer Shutdown” while the democrats label it the “Trump Shutdown.”

The president made a big mistake agreeing to the continuing resolution that set up the 1/19/18 deadline since this is the one-year anniversary of his inauguration and he is planning the big celebration party at Mar-a-Lago with his political donors. The democrats were incentivized to ruin this weekend for the president; and they did.

Vice President Pence says good-faith negotiations must continue but President Trump, Senate Majority Leader McConnell and Whitehouse spokesmen take a hardline. Through a spokesman, President Trump proclaims, “We will not negotiate the status of unlawful immigrants while democrats hold out lawful citizens hostage over their reckless demands. This is the behavior of obstructionist losers, not legislators.”

The Whitehouse says negotiations on a spending bill cannot occur until the democrats agree to pay the military and first responders. The government shutdown will cost the US taxpayer $6 billion per week. Washington, DC, incompetency is on full display. Smart Americans declare a pox on both the republican and democrat houses.

A new spending bill is proposed that would continue funding the government until 2/8/18. The House convenes at 9 AM EST this morning and the Senate will hold session at noon. The sun rises and the politicians begin another day of arguments, lies, backstabbing and other beltway baby games.

President Trump’s donors will not be happy since the orange-headed showman may not attend the fundraising event in Florida this weekend. Today will play out with lots of drama. Most importantly, in the corrupt politician’s minds, is who receives the blame for the government shutdown. This is the major focus and concern of the democrat and republican leaders this morning instead of doing what is good and right for the American people.

At 6:18 AM EST, President Trump tweets; “Democrats are far more concerned with Illegal Immigrants than they are with our great Military or Safety at our dangerous Southern Border. They could have easily made a deal but decided to play Shutdown politics instead.”

Today is President Trump’s one-year anniversary of his inauguration. Instead of celebrating his accomplishments and the tax-cut bill, the government goes into shutdown. For a guy that brags about deal-making, the president blundered handing leverage to the democrats since he scheduled the funding deadline to coincide with his anniversary and the fundraising party in Florida. It was easy for the democrats to play the role of the skunk at the garden party.

In addition, the State of the Union address by President Trump is on 1/30/18 only 10 days away. The first thing that all presidents say each January during this key address to the nation is “the state of the union is strong.” What will the president say if the shutdown continues? Perhaps “the state of the union is in shutdown.”

President Trump, who sometimes displays adolescent behavior, tweets for a second time this morning complaining; “This is the One Year Anniversary of my Presidency and the Democrats wanted to give me a nice present.”

A blend of polls places President Trump’s approval rating at 39% the lowest of any president after one year in office. The US government is in shutdown for over six hours and counting.

SPX 2810. INDU 26072. COMPQ 7336. NDX 6834. RUT 1598. NYA 13384. TRAN 11305. SOX 1372.

NIKK 23808. SPASX200 6006. KOSPI 2520. SSEC 3489. HSI 32255. BSE 35512. DAX 13434. CAC 5527. FTE 7731. MIB 23749. IBEX 10480. PSI 5689.

There are large women’s marches occurring across major US cities including New York City, Los Angeles and Dallas. Women wearing pink hats are demonstrating for equal rights (since a woman in America is paid about 79 cents on the dollar compared to a man performing the same job) and other issues. Many of the protestors hold anti-Trump posters. President Trump tweets that it is “a nice day for a march” but oddly tells the women to celebrate the wealth creation that has occurred under his watch.

Vice President Pence begins a trip to the Middle East meeting with Egypt President al-Sisi. Pence says a two-state solution for the Israeli’s and Palestinian’s remains on the table. He seeks to calm the Arab world’s concern about the US recognizing Jerusalem as the capital of Israel.

At 2:20 PM EST, the Whitehouse holds a press conference placing spin on the government shutdown. The democrats and republicans are pointing fingers at each other as the blame game intensifies but both sides are too stupid to realize that each time they point a finger three fingers are pointing back at them.

The Whitehouse says that National Guard training is cancelled due to the shutdown. The spokesmen says the government is not paying our men and women in uniform and those protecting our border. The demopublicans and republocrats hit the same talking points when shutdowns occur.

OMB Director Mick Mulvaney says three types of notices have gone out to government employees; one that says the worker is exempt, another that furloughs the employee and a third notice that requires employees to come in for a few hours of work to bring their tasks to a logical stopping point and then they will be furloughed. The EPA is shut down.

The republicans are not a fan of regulations and the Environmental Protection Agency so they knife it in the back. If the democrats were in power, they would be stabbing the military in the back during the shutdown. These are the baby games the Washington, DC, bureaucrats play.

Mulvaney dubs the government shutdown a “lapse.” He says any documents pertaining to the shutdown are titled as a “Lapse in Government.” The politico’s love their semantic games.

President Trump’s trip to Mar-a-Lago for a big anniversary fundraising party is officially cancelled. The democrats put the screws to the orange-headed leader of the Free World but it was also the president’s fault for agreeing to an extension date that ended at his one-year inaugural anniversary.

The president says the trip to Davos this coming week is now a day to day decision. It sounds like if the shutdown continues, Trump will not attend Davos. The optics would be bad with the president hobnobbing with the world’s wealthy elite eating caviar while common Americans are losing money.

In the evening, the bigtime republican fundraising gala occurs at Mar-a-Lago without President Trump attending. Instead, his son Eric Trump attends. People should have asked for their money back. Eric Trump does not present himself as the sharpest tool in the shed and sticks his foot in his mouth proclaiming, “I think it’s (the shutdown) a good thing for us (republicans).”

A politician should never revel in the misery of people. Common folks will be impacted if the shutdown continues but the elite privileged class are more concerned about their political baby games. As would be expected, Eric Trump boasts about his father probably reading the accolades from a piece of paper that his dad provided.

The republican politicians, especially on the Sunday morning talk shows, will likely denounce and distance themselves from Eric Trump’s statement that the shutdown is “a good thing.”

Thursday, January 18, 2018

FRIDAY 1/19/18; Chinese Yuan Strengthens to 6.39; US 10-Year Treasury Yield Prints 2.646% Highest Since July 2014; German 10-Year Bund Yield Prints 0.60%; STI; R; SYF; KSU; SLB; Consumer Sentiment; SPX, COMPQ, NDX, RUT, NYA, and SOX Print All-Time Record Highs; US Government Shutdown Occurs

Aussie and Asia stocks are trading on the positive side shaking off the weakness in the US. The gains are marginal with Australia’s ASX 200 slipping to the downside. The energy and mining stocks slap the SPASX200 lower. Santos -1.3%. Rio Tinto -1%.

The Nikkei Index trades positively with Nintendo up +4.2%. Honda drives +0.7% higher. Toyota +0.5%. Banks are trading higher. Sumitomo Mitsui +1.3%. The SoftBank deal with Uber shareholders closes. SoftBank becomes Uber’s largest shareholder.

The KOSPI is up marginally with gains in autos offsetting losses in Samsung Electronics and SK Hynix. Hyundai Motor accelerates +4.2% higher.

Chinese stocks continue moving higher this week with both the SSEC and HSI up +0.2% and more. Tencent +0.5%. Wanda Hotel is halted from trading.

Dollar/yuan 6.3949. The yaun is strengthening past the 6.40 level to 6.39 which will be defended by the PBOC. China will intervene in the currency market and weaken the yuan back to 6.40, 6.41 and 6.42. USD 90.40. The US dollar index is dropping like a rock; it was at 91.00 on Wednesday.

US Treasury yields are; 2-year 2.05%, 5-year 2.42%, 10-year 2.64%, 30-year 2.92%. The 2-10 spread is 58.5 bips. The breach of the 2.63% level on the 10-year receives a lot of attention. This is the level of the double-top in the 10-year yield one year ago. The 10-year yield is at levels not seen since September 2014 at 2.642%.

Bond king Jeff Gundlach said the 2.63% was a line in the sand and the long-term bear market in bonds will begin (lower prices higher yields). Bond king Bill Gross says the move above 2.50% ushered in the long-term bear market for Treasuries.

Apple plans to pay a $38 billion tax bill to Uncle Sam to repatriate overseas funds. Apple will likely sell US Treasuries to raise the funds to pay the tax bill. This realization creates upside pressure in yields over the last 12 hours.

Interestingly, as yields rise the expectation would be for the US dollar index to rise. However, the opposite is happening. The dollar is dropping overnight. Another layer of complexity and oddness is piled on to the market heap. The central bankers have intervened in global markets for nine years. No one knows how the game ends.

The US dollar index, dixie, is printing at 90.20 and printed a low at 90.11 overnight; this number is important support going forward. The dollar is a whisker from an 89-handle. The weaker dollar sends the yuan, yen, pound and euro higher.

India stocks are trading higher joining the other green screens in Asia. The Nifty is up 15 points to 10832. The BSE Sensex is up 77 points, +0.2%, to 35338.
S&P -1. Dow -5. Nasdaq +4.

Euro 1.2274. Dollar/yen 110.81. Pound 1.3915. The Aussie dollar is above 0.8 to 0.8014 driven higher by the China economic data from yesterday. India rupee 63.72. Dollar/yuan 6.3956.

WTIC oil is down -1.1% to 63.22. Brent oil 68.71. Natural gas 3.16. Gold 1333. Silver 17.06. Copper is up +0.9% to 3.2285. A buoyant copper price is the stock market bull’s best friend.

The NIKK ends the session up +0.2% to 23808. Topix +0.7%. The ASX 200 is the skunk at the garden party finishing the session down -0.2% at 6006 a palindrome holding on to the 6K level. The KOSPI gains +0.2% to 2520. China’s Shanghai Index is up +0.4% to 3489. CSI300 +0.3%. Hong Kong’s HSI rallies +0.4% to 32255. Taiex +0.7%. Straits Times +0.7%.

For the week, Japan’s Nikkei Index gains +0.7%. Australia’s ASX 200 finishes the week with a -1.1% loss. South Korea’s KOSPI gains +1%. China’s Shanghai Index rallies +1.7%. Hong Kong’s Hang Seng Index jumps +2.7% this week breaking out to new all-time record highs.

Chinese stocks lead this week since the PBOC goosed the stock market with easy money. The central bankers are the market. The land down under was plowed under.

Treasury yields are; 2-year 2.05%, 5-year 2.43%, 10-year 2.64%, 30-year 2.92%. The 2-10 spread is 58.8 bips.
At 3 AM EST (8 AM London; 9 AM Central Europe), European indexes begin trading on each side of the flat line. DAX +0.3%. CAC -0.1%. FTSE flat. MIB flat. IBEX -0.3%. PSI -0.2%. SMI flat. OMX +0.2%.

Energy, banks, consumer staples, retail and utilities are weak while basic resource and tech stocks are slightly higher. Iron ore prices are rallying which helps the basic resources sector. Healthcare stocks are strong.

Rightmove moves +2.3% higher. EasyJet soars +2.3% higher. Airbus flies +1.8% higher on the Emirates deal for A380 airplanes. Novo Nordisk +1.4%. BASF is up +0.8% on earnings. Fevertree +10%.

Total -0.5%. Royal Dutch Shell -0.4%. BP -0.3%. HSBC -0.2%. Allianz -0.3%. Spanish infrastructure company Ferrovial -3.4%. British retailer Kingfisher -2.4%. German retailer Ceconomy crashes -11% on weak earnings.

Funeral services provider Dignity has one foot in the casket as it crashes -51% losing its dignity. Carpetright crashes -48% on lower sales and a profit warning that they are unable to sweep under the rug. Funeral homes and floor coverings are taking a beating in Europe.

The German coalition government saga continues. The SPD (Social Democratic Party) votes on Sunday to approve or disapprove of an alliance with Chancellor Merkel and forming a coalition government. A vote in favor of a forming a coalition government will lead to detailed discussions. If the SPD votes down the partnership with Merkel, it will likely lead to snap elections and uncertainty across Europe.

At the same time in the United States, the government will shut down midnight tonight if a spending bill is not approved through Congress. The House passes a spending bill last evening but the democrats in the Senate say they have the votes to stop the bill. There is lots of drama ahead for the US and Germany today and through the weekend.

US futures are calm so traders expect the US lawmakers to come to an agreement today and avert the government shutdown.

S&P flat. Dow +11. Nasdaq +5. Russell flat. VIX 12.22.

Euro 1.2266. Euro/yen 135.82. Dollar/yen 110.73. Pound 1.3921. Euro/pound 0.8812. Mexican peso 18.6022. Canadian dollar 1.2427. Indian rupee 63.76. Aussie dollar 0.8015. Dollar/yuan 6.4055. The yuan strengthened to 6.39 overnight so the PBOC is intervening in the currency market weakening the yuan back to 6.40. The central bankers are the market.

WTIC oil is down -1.2% to 63.21. Brent oil is down -1% to 68.64 now well off the 70-plus levels in recent days. Natty 3.15. Gold is up 7 dollars, +0.5%, to 1334. Silver is up +0.7% to 17.07. Copper is up +0.7% to 3.2225.

Treasury yields are; 2-year 2.05%, 5-year 2.43%, 10-year 2.64%, 30-year 2.93%. The 2-10 spread is 59.1 bips.

At 4:30 AM, UK Retail Sales are down -1.5% in December weaker than expected. UK Retail Sales are only up +1.9% last year. Sterling is steady at 1.3917.

At 5 AM EST (9 AM London), DAX +0.9%. CAC +0.5%. FTSE +0.2%. IBEX +0.4%. PSI flat. SMI +0.4%. OMX +0.3%. Carpetright -39%. Dignity is dying -53%.

S&P +8. Dow +81. Nasdaq +33. Russell +5. VIX 12.07. US futures catch a strong bid but at the same time the VIX remains above 12.

Euro 1.2277. Euro/pound 135.84. Dollar/yen 110.63. Pound 1.3907. Euro/pound 0.8829. Mexican peso 18.5969. Canadian dollar 1.2415. Dollar/yuan 6.402. Indian rupee 63.75. Aussie dollar 0.802. USD 90.25.

Bitcoin 11695. Ethereum 1060. Ripple 1.65. Bitcoin cash 1827.

WTIC oil is down -0.9% to 63.37. Brent oil is down -0.9% to 68.70. Natty gas 3.18. Gold 1336. Silver 17.10. Copper is up +0.666% to 3.2205.

Treasury yields are; 2-year 2.048%, 5-year 2.42%, 10-year 2.63%, 30-year 2.91%. The 2-10 spread is 58 bips. The high yield in the 10-year overnight is 2.642% which becomes an important resistance level for yield.

The IEA says the United States is set for explosive growth in oil drilling and development. The news has created sogginess in oil prices overnight. The North American producers should keep oil prices in check on the upside.

India stocks finish higher. The Nifty ends up 78 points, +0.7%, to 10895. The BSE Sensex is up 251 points, +0.7%, to 35512. The BSE rallies +2.6% this week.

S&P +9. Dow +90. Nasdaq +34. Russell +7. VIX 12.04.

DAX +1%. CAC +0.5%. FTSE +0.3%. MIB +0.9%. IBEX +0.5%. PSI flat. SMI +0.5%. OMX +0.4%. The German 10-year bund yield prints 0.60% the first time since July 2017.

Euro 1.2261. Dollar/yen 110.77. Pound 1.3881. USD 90.37.

WTIC oil 63.40. Brent oil 68.666. Natty 3.15. Gold 1334. Silver 17.06. Copper 3.2245.

Treasury yields are; 2-year 2.05%, 5-year 2.42%, 10-year 2.63%, 30-year 2.92%. German bund 0.587%. Japan 10-year yield 0.078%. UK gilt 1.338%. France 10-year yield 0.859%.

S&P +4. Dow +40. Nasdaq +20. Russell +2. VIX 12.19. DAX +1%. CAC +0.4%. FTSE +0.2%.
Several notable companies report earnings with the following stock moves occurring. Regional banks are happy. STI +0.5%. RF +0.6%. CFG +1%. SYF sinks -2.1%. KSU -1%. SLB -3.3%.

IBM -3%. AXP -2.3%. FL bounces +2.8% on a Telsey upgrade. NKE pops +1.5% on Telsey and Wedbush upgrades. Biogen makes advances towards Acorda Therapeutics. ACOR catapults +16% higher. BIIB +0.5%. Kroger is making advances towards Overstock.com. OSTK +3.5%. KR trades flat. SNAP loses -0.4% on news of laying off workers.

AMZN jumps +1.5% as rumors surface that the Amazon Prime monthly fee will jump +20%. CEO Bezos must figure that most of the Prime customers will buckle under like little puppy dogs and pay more without complaining.

S&P +5. Dow +24. Nasdaq +28. Russell +3. VIX 12.24.

The government shutdown drama is ramping up with the political actors at work on Capitol Hill. The television reporters create theatrics and hint that a shutdown is coming. Traders are not concerned since futures are calm. Traders expect the weasel politicians to agree on a spending bill today.

President Trump tweets that he will not leave Washington, DC, until a spending bill is completed and a government shutdown is averted. There is no clarification if Trump is going to cancel the gala event planned at Mar-a-Lago. Trump is supposed to know ‘the art of the deal’ but he miscalculated and instead looks like a fool. The democrats are using Trump’s fundraising party as leverage for making a deal.

Surely, the president will not be partying at Mar-a-Lago if a shutdown occurs (bad optics) and if Trump wants to have his fundraising party, he will have to make a deal with the democrats. Today will be interesting.

The president must have realized the democrats had leverage on him and that is why he tweets about staying in Washington but the democrats will probably call his bluff. Trump’s wealthy donors will not be happy if the gala event is cancelled especially because the trophy wives have already bought $2,000 dresses for the gala.

S&P +10. Dow +80. Nasdaq +32. Futures pop as the regular trading session begins.

At 9:30 AM EST, US stocks begin trading higher sans the Dow Industrials. The S&P 500 is up 10 points, +0.4%, to 2806. The Dow is down 10 points, call it flat, at 26007. The Nasdaq Composite rallies 18 points, +0.3%, to 7314. The RUT gains 5 points, +0.3%, to 1580. VIX 12.09.

Banks are higher. XLF +0.3%. JPM +0.7%. C +0.3%. KRE +0.5%. RF +2.1%. AXP -2.6%. SQ jumps +5%. Healthcare and biotech stocks are leading higher. XLV +0.3%. IBB +0.3%. Basic materials rally. XLB +0.5%. LOW +1.8%. AMZN +0.9%.

Energy stocks sink. XLE -0.4%. SLB -1.666%. NOV -2%. XOP -1%. XOM flat. IBM -2.8%. The General Electric turd keeps floating in the bowl; GE -3.3%.

Bingo. The US 10-year yield is at 2.646% taking out the overnight high at 2.642% and comparing back to July 2014. Treasury yields are; 2-year 2.065%, 5-year 2.436%, 10-year 2.646%, 30-year 2.923%.

The NDX prints a new all-time record high at 6843.24. tech stocks remain hot. The SOX also prints a new all-time record high at 1378.16. Chips are on fire to the upside the last couple days ever since ASML received the large order for semiconductor equipment.

The home security company ADT IPO comes to market and begins trading -11% lower.

Euro 1.224. Dollar/yen 110.666. Pound 1.3871. WTIC oil 63.32. Brent 68.70. Natty 3.18. Copper slips -0.1% to 3.197. Platinum continues the ongoing rally to 1019. Palladium 1096.

SPX 2805. INDU 26046.66. COMPQ 7316. RUT 1577. VIX 12.10.

Treasury yields are; 2-year 2.065%, 5-year 2.436%, 10-year 2.646%, 30-year 2.923%.

The Whitehouse says a press briefing will occur at 10:30 AM EST concerning the potential government shutdown.

At 10 AM, Consumer Sentiment is 94.4 below the 97.0 consensus and prior 95.9. In the common person’s eyes, some of the luster is coming off the economic rose. Lower sentiment typically leads to lackluster retail sales.

At 11:15 AM, OMB director Mick Mulvaney provides a press briefing on the government shutdown. Mulvaney says the Office of Management and Budget is preparing for the shutdown. Mulvaney espouses the republican talking points and proclaims, “We don’t want this...a shutdown.” He lays any potential shutdown at democratic Senate leader Chuck Schumer’s feet labeling the drama as “Schumer’s Shutdown.”

The knives are out between the democrats and republicans. Mulvaney calls out the democrats declaring, “There is no way you can lay this (a government shutdown) at the president’s feet.” The stock market is not impacted by Mulvaney’s comments. The democrats fight back quickly telling republicans to support the “Schumer Solution.”

At 11:30 AM EST (4:30 PM London; 5:30 PM Central Europe), European stocks finish the session higher. The DAX gains 153 points, +1.2%, to 13434. The CAC rallies +0.6% to 5527. The FTSE gains +0.4% to 7731. The MIB rallies +0.5% to 23749. The IBEX gains +0.5% to 10480. The PSI finishes +0.3% higher to 5689. Germany leads.

For the week, Germany’s DAX jumps +1.5%. France’s CAC +0.2%. London’s FTSE -0.6%. Italy’s MIB +1.4%. Spain’s IBEX +0.2%. Portugal’s PSI finishes the week with a +1.2% gain. Germany, Italy and Portugal are the winners this week. UK stocks are slapped around.

The German 10-year bund yield is 0.57% and tagged the 0.60% level today a six-month high.
The stock market does not care about a US government shutdown. Traders yawn at Mulvaney’s comments and surmise that a deal will occur today to avert the shutdown. SPX 2802. INDU 25974. COMPQ 7320. RUT 1590. Small caps catch a bid. VIX 11.41.

The ongoing bullish sentiment and complacent attitude in the stock market is reflected by the low VIX and low CPC and CPCE put/call ratios. The Investors Intelligence sentiment survey reports 66.7% bulls and 12.7% bears the widest spread in 32 years.

Nearly $60 billion, the largest amount ever, flows into stock and mutual funds including ETF’s over the last four weeks. Traders and investors, especially Joe Sixpack and Ma and Pa Kettle, are caught up in the hype of new record stock market highs day after day and are tripping over each other to buy equities at the ask.

Euro 1.2235. Euro/yen 135.37. Dollar/yen 110.63. Pound 1.385. Euro/pound 0.8835. Indian rupee 63.8462. Mexican peso 18.5873. Canadian dollar 12453. Dollar/yuan 6.404.

WTIC oil drops -1.4% to 63.08. Brent oil loses -1.3% to 68.42. Gold 1334. Silver 17.02. Copper is down -0.3% at 3.19.

Treasury yields are; 2-year 2.05%, 5-year 2.42%, 10-year 2.63%, 30-year 2.91%. The 2-10 spread is 57.9 bips.

SPX 2801. INDU 25961. The Dow is below the 26K level. COMPQ 7315. RUT 1590. VIX 11.55.
Retail stocks rally. XRT +1.2%. NKE +3.9%. KSS +3.2%. MO +2%. LOW +2.8%. HD +1.2%. FL +2.5%. SQ +6%. WYNN +1.5%. IBM -4.1%. GE -1.6%.

The Senate says a vote will occur this afternoon on a spending bill to avert a shutdown.

At 12:45 PM, the Whitehouse says democrat Senate Minority Leader Schumer will meet with President Trump at the Whitehouse within the hour. Perhaps the two leaders can hash out a deal to avert the government shutdown at midnight. Traders are not concerned since the politicians always reach an agreement before the deadline.

At 1 PM, the BHGE North American Oil Rig Count is up 46 oil and gas rigs. US rigs are down 3 and Canadian rigs up 49. In the US, 5 oil rigs are shuttered but 2 natty gas rigs are activated. In Canada, oil rigs increase by 23 and gas rigs are also up by 26 rigs. WTIC oil moves from 63.40 to 63.30 and then recovers higher. Oil prices are bumping along sideways. Brent oil moves from 68.75 to 68.60 but then recovers higher.

At 2:30 PM, the meeting between President Trump and Senate leader Schumer ends. Schumer tells reporters, “We made some progress.” Schumer says there is no deal yet but discussions will continue this afternoon.

The stock market did not sell off this morning due to a potential shutdown and now with the slightly encouraging news equities float higher. SPX 2807. The Dow is teasing into positive numbers. INDU 26018. COMPQ 7332. RUT 1596.

Bingo. At 2:34 PM, the SPX prints a new all-time record high at 2807.71. The COMPQ prints a new all-time high at 7333.94. The NDX prints a new all-time record high at 6843.24. The SOX prints a new all-time high at 1378.16 at the opening bell but price is at 1370 as the other indexes print record highs. Chucky Schumer’s words create new record highs.

For the eight major indexes, the S&P 500, Nasdaq Composite, Nasdaq 100, and SOX Semiconductors print all-time record highs but the Dow Industrials, Russell 2000, NYSE Composite and Dow Transports do not. The RUT small caps, however, lead all indexes higher today up +1.2%.

At 3 PM, SPX 2807. INDU 26031. COMPQ 7332. RUT 1596. VIX 11.48.

Euro 1.2231. Dollar/yen 110.60. Pound 1.3872. WTIC oil 63.40. Brent oil 68.666. Natty gas 3.19. Gold 1334. Silver 17.10. Copper is down -0.4% to 3.1875. Other metals are rallying. Platinum 1019. Palladium 1100.

Treasury yields are; 2-year 2.056%, 5-year 2.434%, 10-year 2.637%, 30-year 2.91%. The 2-10 spread is 55.9 bips. The 5-30 spread is 47.6. The 2-30 spread is 85.4 bips. The 5-year yield is rising a touch faster than other yields creating more narrowing in the 5-30 spread.

XLP +1%. MO +1.2%. TSN +1.9%. KR +2.1%. OSTK +5.5%. XLY +0.8%. XLE -0.3%. XLK flat. Apple suppliers are slapped in the face after another analyst downgrades a forecast for iPhone X shipments. QRVO -2.8%. CRUS -3%. SWKS -3%. MTSI -2.6%. AAPL -0.5%.

NKE +4.6%. GS +1.7%. HD +1.2%. CAT +1.2%. MCD +1%. MAT +5.4%. HBI +5.2%. UAA +5%. KSS +3.7%. ROST +2%. FOSL +11%. NVDA +2.4%. ORLY +2.2%. ADSK +2.2%.     
             
IBM -3.8%. GE -3%. AXP -2.2%. PFE -0.8%. BA -0.7%. CBS -3.4%. MKC -3.2%. MU -2.6%. CTRP -1.1%. HOLX -1.1%. EXPE -1%. BLUE -3.5%. XON -6.66%.

At 3:10 PM, SPX 2806. INDU 26021. COMPQ 7329. RUT 1594. VIX 11.48.

Into the closing bell, the VIX sinks lower printing the lows of the day at 11.29. Stocks float higher into the weekend. SPX 2809. INDU 26048. COMPQ 7333. RUT 1596. VIX 11.28.

At 4:00 PM EST, US stocks end the day in rally mode. Traders could not care less about a government shutdown whether it occurs or not. The SPX gains 12 points, +0.4%, to 2810.30 a new all-time closing high and 2810.33 a new all-time high.

The Dow Jones Industrials gain 54 points, +0.2%, to 26072. The Nasdaq Composite rallies 40 points, +0.6%, to 7336.38 a new all-time closing and intraday high (price closes on the high). The Nasdaq 100 gains 23 points, +0.3%, to 6834.33 a new all-time closing high and 6843.24 a new all-time high.

The RUT gains 21 points, +1.3%, to 1597.63 a new all-time closing high but not a new all-time high. The NYA rallies 69 points, +0.5%, to 13384.46 a new all-time closing and intraday high. TRAN gains +0.4% to 11305. The Dow Jones Industrials and the Dow Jones transports are the two major indexes that did not print all-time record highs today. The SOX semiconductors gain 1 point to 1372.03 a new all-time closing high and 1378.16 a new all-time high.

VIX 11.27. VIX LOD 11.18. VIX 200-day MA 10.84. The VIX remains above the important 20-day MA for four days and it amazing that the stock market has not trailed lower. Something special is probably going on under the surface to warrant the odd behavior.

For the week, the S&P 500 gains +0.9%. The Dow Industrials finish the week +1% higher. The Nasdaq Composite gains +1%. NDX +1.1%. RUT +0.4%. NYA +0.6%. TRAN -0.6%. SOX jumps +3.8% higher. Chips are the big winner this week sending the broad stock market higher.

The sectors finish the week mixed. Semiconductors, consumer staples, healthcare, technology, retail and bank stocks lead higher. SMH +4.3%. XLP +2.4%. XLV +1.9%. XLK +1.5%. RTH +1.5%. XLF +1.1%. XRT +1%. XHB +0.8%. ITB +0.8%. XLRE +0.8%. KRE +0.666%. XLY +0.5%. VNQ +0.1%. IBB flat. XLB -0.2%. VOX -0.3%. XLU -0.5%. XLI -0.6%. IYT -0.6%. XAL -0.8%. XLE -1.3%. XOP -2.5%. Utilities remain weak and in a correction. Trannies and airlines drag each other lower. Energy stocks are beaten.

Consumer staples are a big winner. The staples are typically a defensive play that provides a dividend. Traders prefer the staples late in the business cycle. However, the Federal Reserve and other global central bankers have destroyed all price discovery as well as the expected business and economic cycles with their obscene Keynesian money printing.

When stocks move lower the sectors will likely all move lower in sync. The investors that think they are smart to park money in the staples do not realize they are probably only covering themselves with a fig leaf. These are not your grandfather’s markets. Nine years of central banker money has sent stocks to the stratosphere and no one knows how the ride ends.

The 22 high-flying stocks that have led the broad stock market higher for the last few years finish the week mixed. AAPL +0.8%. AMZN -0.8%. AVGO +0.8%. BA +0.5%. CELG -0.2%. CRM +1.5%. FB +1.1%. GE -13%. GOOGL +1.1%. HD +2.5%. MA +2.8%. MSFT +0.5%. NFLX -0.4%. NKE +3.9%. NVDA +3.2%. PCLN -0.5%. RTN -0.4%. SBUX +1.4%. STZ +0.4%. ULTA +2.9%. UAA -6%. V +2.2%.

The piece of garbage know as GE drops -13% this week at a six-month low. Every day a new skeleton is discovered in the General Electric closet. Former CEO Immelt was the only one that knew where the bodies were buried.

UNH is a big winner this week gaining +6.4% which pumped the Dow higher. Chip equipment darling LRCX jumps +10.1%. The chip joy this week was led by ASML that rocket launched +14% higher.

WTIC oil loses -1.5% this week to 63.31. The high is 64.89 that compares back to December 2014. Brent oil loses -0.8% this week to 69.31 at three-year highs. Natural gas, NATGAS, drops -0.5% to 3.18.

Gold drops -1.8% this week to 1333. Silver drops -0.6% this week to 17.04 sitting at the 200-week MA and ready to make a bounce or die decision. Copper drops -1% this week down for three consecutive weeks to 3.19.

Treasury yields are; 2-year 2.07%, 5-year 2.45%, 10-year 2.66%, 30-year 2.93%. The 2-10 spread is 59 bips. The 5-30 spread is 48 bips. The 2-30 spread is 86 bips.

The 10-year yield prints just shy of 2.65% a level not seen since July 2014. The 10-year moves through the 2.52%-2.65% range. The 2-year yield runs to 2.07% a level not seen since 2008.

The US dollar index is at 90.69 moving through the 90.20-91.00 range this week. The euro is at the 1.2221 palindrome moving through 1.218-1.230 this week. Pound 1.3857.

After the closing bell, BG springs +1% higher adding to the +11.4% gain during the regular session. Archer Daniels approaches Bunge for a takeover. As usual, the insider traders knew that the takeover news was coming ahead of time and made handfuls of easy money profits over the last day. ADM +0.5%.

Fitch raises Spain’s credit rating from BBB+ to A- with a stable outlook. S&P raises Greece’s rating to B from B- with a positive outlook. The Europeans toast the credit upgrades with ECB wine.

As all the shutdown drama occurs in Washington, DC, three is a far more serious matter occurring behind closed doors at Capitol Hill. A four-page memo is provided to lawmakers under secrecy that details potential nefarious behavior at the FBI, other spook agencies and in the US government under President Obama.

The memo may show proof that Hillary Clinton, President Obama and others conspired to produce a fake dossier that was used to secure surveillance warrants against then-candidate Trump in 2016. The FBI then proceeded to wire-tap Trump Tower during the campaign season and likely fed information back to President Obama, Hillary Clinton and the democrats. The memo is purported to be so explosive it makes Watergate look like child’s play, however, politicians are prone to hyperbole.

Nearly everyone expected Hillary Clinton to win the presidential election in November 2016 so perhaps there was brazen and nefarious behavior occurring on the democrat side since power was expected to remain in their camp (there would be no consequences). But the voters chose the orange-headed republican Donald Trump instead.

The democrats say the memo is only trying to discredit Special Counsel Mueller and his investigation into Russia tampering with the US election. America’ political system is corrupt and the republicans and democrats are two sides of the same coin. Humans are corrupt. It is no mystery.

There may be a story unfolding in the weeks and months to come that is larger than Watergate and may drag the Clinton’s and Obama back into the spotlight; and not in a good way. The lawmakers are debating in heated meetings whether the four-page memo should be released to the American public so it must be bombshell news.

At 4:48 PM, the republicans and democrats are working on a spending bill to avert a government shutdown only seven hours away. Reporters say a deal may be in the works that extends the deadline a few days. The stock market must have sniffed out the deal into the closing bell.

At 5:30 PM, President Trump says progress on a spending bill continues and he favors extending the deadline for four weeks. That would make him the Can Kicker-in-Chief. The clock is ticking with a government shutdown only 6-1/2 hours away unless a stop-gap spending bill is approved.

As the evening progresses, the talks of compromise on a spending bill deteriorate. The politicians are on the floor of the US Senate but unable to achieve the votes needed to pass the House funding bill. 60 votes are needed to pass the bill not the simple majority of 51 like the tax bill (there are 100 senators two from each state).

Several republican senators vote against the spending bill while several democrats vote in favor of the bill. Democrats in states that Trump won voted in favor of the bill to appease their constituents.

The clock strikes midnight. The funding deadline passes. The US government is shut down for the first time since 2013. What does this mean? Non-essential government workers will be furloughed while essential personnel will continue with their duties but not receive pay. There are differing opinions on the impacts from a government shutdown; it will have to play out this weekend and in the days ahead.

Folks living on fixed income should continue to receive their social security checks. The post offices will remain open. Parks will remain open but the workers will not be there to assist visitors or empty the trash cans.

The blame game begins at 12:01 AM EST.