- How did “taxation is theft” suddenly become a thing?
- Revenge on the IRS? How to collect a “tax back” payout four days after Tax Day
- One more factor that will goose gold as 2016 goes on
- The Panama Papers: Obama confirms one of The 5’s most tinfoil suspicions
- One merger killed, another in jeopardy… New York Times connects gold bugs to terrorists… virtual reality’s earliest origins… and more!
If, as Victor Hugo supposedly said, there’s nothing more powerful than an idea whose time has come… what are we to make of this chart?
The chart measures interest in the search term “taxation is theft” on Google.
It’s important to note the scale here is relative over time: Plug any search term into Google Trends and the resulting chart will be on a scale of 0–100. So don’t get the wrong idea: It’s not as if interest in “taxation is theft” has suddenly surpassed interest in, say, “Kim Kardashian’s ass.”
Why it’s taking off now we’re hard-pressed to say. A headline at The Free Thought Project refers to “one group’s viral meme campaign,” but the article doesn’t identify this “one group.” Still, the memes aren’t hard to find…
Whoever’s behind the campaign has a good sense of timing. After all, Tax Day is only 12 days away now — Monday, April 18.
Which brings up the historical oddity of why Tax Day doesn’t fall on April 15 this year.
In the District of Columbia, Emancipation Day is a legal holiday marking the day in 1862 when President Lincoln signed a bill freeing about 3,100 slaves within the district.
“The District of Columbia Compensated Emancipation Act,” according to Wikipedia, “represents the only example of compensation by the federal government to former owners of emancipated slaves.” Even then, living within the confines of the Imperial City had its privileges.
Anyway, Emancipation Day is the 16th — which falls on a Saturday this year. So Friday the 15th is the official holiday and IRS headquarters will be closed.
In addition, if you live in Massachusetts or Maine, you get an extra day to file. Patriots’ Day, marking the battles of Lexington and Concord and the start of the Revolution, is an official holiday in those states, observed on the third Monday of the month. IRS offices in those states will be closed on the 18th. Now you know.
Something else you likely didn’t know: You can collect series of a “tax back” payouts starting days after Tax Day — as early as Friday, April 22.
Think of it as a way of legally reclaiming some of your hard-earned tax dollars that the feds stole. These payouts range anywhere from $1,720–6,988.
Curious? You can scratch the itch and learn how to collect these payouts right here.
To the markets — which are, God help us, treading water until the next hints of future Federal Reserve policy are revealed later in the day.
By the time you read this episode of The 5, the Fed will have released the “minutes” from its meeting three weeks ago. We put “minutes” in quotation marks because Fed minutes aren’t like the minutes from your local city council meeting. They’re not an objective record of who said what. They’re a document carefully massaged for public consumption.
And traders will still spend the rest of the afternoon evaluating it as a witch doctor examines entrails, for crying out loud.
In the meantime, the major U.S. stock indexes are inching up — the S&P 500 up a half percent at 2,055. Gold has shed most of yesterday’s gains — the bid at last check $1,221.
The big mover is oil after the Energy Department’s latest inventory report revealed U.S. crude stockpiles fell by 4.9 million barrels in the week ended last Thursday. Just the fact that inventories aren’t reaching another record high is good for a 4.5% rally; a barrel of West Texas Intermediate now fetches $37.52.
Until the Fed minutes come out, trader chatter is focused on one scuttled merger, and one merger being challenged by the Justice Department.
Pfizer and Allergan have given up their merger plans, a development we foreshadowed yesterday. Meanwhile, the feds are suing to stop a deal that would combine Halliburton and Baker Hughes, the No. 2 and 3 oil services companies.
The deal was first announced in November 2014 — days before OPEC shocked the world and decided not to cut production. Executing the merger has taken forever and traders are greeting the news with relief: As we check our screens, they’ve bid up HAL 5% and BHI 6%.
That said, “It’s going to be tough to get both these players back up to speed,” Byron King tells us via email. “All of which is good for industry leader Schlumberger.” For the moment, SLB is up 2% on the day.
If gold ETFs accelerated the decline in the gold price during 2013, they’ll accelerate gold’s recovery during 2016.
Consider GLD, the most popular gold ETF. “During the worst of the gold bear market,” says Dan Amoss of our macro strategy team, “GLD became less popular. On days when declines in GLD outpaced declines in gold futures, market makers redeemed GLD shares outstanding.
“The ETF redemption process intensified declines in the gold price. During this process, the number of gold ounces held in the trust backing GLD fell by about 50%.
“Now, we expect the ETF creation process to have a similar influence on gold prices,” Dan concludes — “only now, it will be positive. ETF creation will intensify buying pressure in the gold market.”
Sure enough, since gold’s lows in December, GLD’s holdings have grown 30%, to 26.2 million ounces.
[Ed. note: However, when it comes to “paper gold” vehicles, you should know Jim Rickards frowns on GLD. There are only two he likes, and he identifies them in his new book, The New Case for Gold, which was released to the public yesterday. If you still haven’t claimed your nearly free copy through us, our best deal has come and gone… but we still have a pretty good deal available.]
We can only imagine the gold bashers will latch onto this one: Osama bin Laden wanted one-third of an al-Qaida windfall put into the Midas metal.
In another selective leak of the papers seized when Navy SEALs raided bin Laden’s Pakistan hideout and killed him five years ago, The New York Times informs us that in late 2010, al-Qaida had secured a $5 million ransom from Afghanistan’s government for the release of a diplomat. Bin Laden wanted a third of it invested in gold coins and bars.
“Even with occasional drops,” he wrote a senior aide, “in the next few years the price of gold will reach $3,000 an ounce.”
The Times article drips with sarcasm and guilt by association, starting in the lead: “Bin Laden turns out to have been as bullish about the precious metal as any Ron Paul devotee, tea party patriot or Wall Street financier.”
And for the story to come out yesterday, the same day as Jim Rickards’ The New Case for Gold is published? Hmmm…
Gee, and we wondered if it was a little bit tinfoil on our part yesterday to connect the Panama Papers to the feds’ crackdown on corporate tax “inversions.”
Around the time we hit “send” on yesterday’s 5, President Obama saw fit to interrupt the daily news briefing by his press secretary Josh Earnest and spout off a bit himself.
“We’ve had another reminder in this big dump of data coming out of Panama that tax avoidance is a big, global problem. It’s not unique to other countries,” he said. “A lot of it is legal, but that’s exactly the problem. It’s not that they’re breaking the laws, it’s that the laws are so poorly designed.”
He hailed the Treasury Department’s crackdown on inversion deals that allow U.S. firms to move their headquarters to a country with a lower corporate tax rate — which is what killed the Pfizer-Allergan deal.
“When companies exploit loopholes like this,” he said, “it makes it harder to invest in the things that are going to make the American economy strong for generations to come.”
Quips Ed Krayewski at Reason: “[Obama] should call Republican presidential front-runner Donald Trump, who has also railed against ‘inversions’ as if money that Americans earn actually belongs to the U.S. government.”
What was it we were saying off the top of today’s episode? Oh yeah…
“As usual, Agora comes through with some meat on the bones of yet another manufactured story,” a reader writes about the Panama Papers, “as we learn that the International Consortium of Investigative Journalists’ leaks were — shall we say? — biased.
“When I spent a few hours late into the night checking out their website to learn the same thing, that most of the people mentioned were at the wrong end of a U.S. rifle barrel as those supposedly close to people who were the target of the American administration…
“Of course, what I (and the royal we) didn’t know, which was provided by your piece, was the providers of funds to this erstwhile upstanding journalistic organization were… members of the NWO?
“If my cynical side is showing, I’m sorry, it’s just I keep remembering a phrase from a wonderful film of yesteryear, All the President’s Men… and the phrase from the quietly spoken whistleblower in the underground garage: ‘Follow the money.’”
The 5: “Follow the money” is the task taken on by Nomi Prins, the best-selling author and contributing editor to Jim Rickards’ Strategic Intelligence.
She’ll have much to say about the Panama Papers in the weeks to come. The only reason she hasn’t weighed in yet is that she’s been in Brazil chasing down the real story behind the endemic corruption there (and its connection to the U.S. banks).
“While everyone was talking about the recent rules regarding inversions and the news out of Panama,” writes one of our regulars, “the states of New York and California passed a new law increasing the minimum wages in their states.
“To be sure, there was a lot of boasting and propaganda being put out by the administrations of these states, but what they conveniently omitted is the raise these people just gave themselves and the federal government. I don’t know the tax rates in either of these states, but the increase effectively gives the U.S. government a 15% raise from all of these individuals working for these wages.
“I’m sure all the ones who receive these pay raises believe they are now wealthier, as the politicians have told them they are, but in reality, if they understood some very basic economics, they would know that soon they will have less purchasing power than they had before.
“But the ones in government really don’t care. They just got a raise. That is until more jobs move out of the country.”
“The University of Utah was doing an early equivalent of virtual reality back circa 1970, at least a full decade before you say,” says a reader expanding on our VR discussion yesterday.
“‘The Google’ is not helping, and I have long since dumped the documentation, so my foggy memory on this topic is not much better than hearsay. Nonetheless, I know a particular Ph.D. thesis involved a helmet attached to a gantry that provided X-Y-Z room location information about the viewer along with head orientation stuff (angles of view, etc.).
“There were projections onto plastic screens in front of the helmet-wearing person’s eyes that showed a wire frame of lines the person could ‘draw’ in three-space with a special light pen. A map of the states’ boundaries was photo-documented as an example of the capabilities.
“Around 1976, I eventually met the man who did that early work when visiting Livermore National Laboratory while I was on an information exchange from Los Alamos National Laboratory. Six degrees of separation — my mother swam at the same club as his wife.”
The 5: As Dana Carvey channeling Johnny Carson would say, “Weird, wild stuff.”
The 5 Min. Forecast
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