BOOM GOES BUST: DOW -530

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BY EVELYN CHENG

U.S. stocks closed deep in the red on Friday as global growth concerns accelerated selling pressure to push the Dow and Nasdaq into correction territory. ( Tweet This )

The major averages had their biggest trade volume day of the year and posted their worst week in four years.

The Dow Jones industrial average closed at session lows, off nearly 531 points and in correction territory for the first time since 2011 as all blue chips declined. The last time the index closed more than 500 points lower was on Aug. 10, 2011. In the last five years, the index has only had four instances with closing losses of more than 400 points.

“For investors the momentum and the drive of the market is now lower (than) it used to be because there’s no place to hide,” said Lance Roberts, general partner at STA Wealth Management. “Every time we hit the major technical points we kept selling.”

“What is important is the price action of the market has done something we haven’t seen since the last bull market peak,” Roberts said. “There is something going on internally in the market. That illness that has been building up in the market.”

A trader also noted that investors stopped looking at technicals and were plowing through them.

“It’s an expiration day and it looks like they’re to have for sale on the close maybe as much as a billion dollars,” said Art Cashin, director of floor trading for UBS.

The Nasdaq Composite lost 3.5 percent, also closing in correction territory and joining the other major averages in negative territory for the year.

Apple declined 6 percent, in bear market territory, and the iShares Nasdaq Biotechnology ETF (IBB) plunged 3.1 percent.

“Right now there is a feeling of fear in the marketplace and all news is interpreted negatively and it’s interpreted indiscriminately,” said Tom Digenan, head of U.S. equities as UBS Global Asset Management.

The S&P 500 fell through a support level of 1,980 to end at 1,970, off 7.6 percent from its 52-week high. The index is off about 4.3 percent for the year so far. Information technology and energy led all 10 sectors lower on the day.

Energy was the worst decliner for the week, with no sectors posting weekly gains. As of Friday morning, 28 percent of the S&P 500 was in a bear market.

“It’s more of the same,” said Peter Boockvar, chief market analyst at The Lindsey Group. “From a technical perspective we broke” 2,040 on the S&P 500, the lower end of the trading range.

The Russell 2000 fell into correction territory in the open and failed attempts to stay out of it.

Read MoreCould Russell correction signal more losses ahead?

Earlier, the averages briefly attempted to halve losses in mid-morning trade.

“I think uncertainty about China (and) general negativity is weighing on the market. There’s a lack of positive economic news to motivate buyers,” said David Kelly, chief global strategist at JPMorgan Funds. He noted “there’s nothing particularly negative in the U.S. economic outlook.”

Oil reversed Thursday’s late gains to briefly fall below $40 a barrel to $39.86 for the first time since March 2009.

Crude oil futures for October delivery settled down 87 cents, or 2.11 percent, at $40.45 a barrel on the New York Mercantile Exchange. Gold futures for December delivery settled up $6.40 at $1,159.60 an ounce.

“Lower oil prices should benefit the U.S. but whenever they collapse like that that brings back bad memories of what’s happening to the global economy,” said Ben Pace, chief investment officer at HPM Partners.

“Earnings season has kind of wound down so the Chinese macro story takes on a bit more of importance than it should,” said David Lafferty, chief market strategist at Natixis Global Asset Management.

“We’ve probably had a bit of a healthy transition here,” he said, noting how bad news is mostly interpreted as bad news rather than good news that keeps the Fed at bay.

In addition to concerns over slowing global growth, analysts also noted some uncertainty over the timing of a rate hike.

“The Fed has created such a mixed message that people don’t know what to do with their money,” said JJ Kinahan, chief strategist at TD Ameritrade. “That makes (it) very difficult to figure out who are the winners and losers for the fourth quarter. People are taking money out of the market.”

The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded above 28.

The index is up more than 47 percent on the day and up more than 100 percent month-to-date for August, on track for its largest monthly gain since 1990.

Earlier in the day, Kinahan said investors should start paying attention now that the VIX is above 20, and that anything over 25 indicates “true fear.”

Still, “we’re coming off such a quiet market, sometimes there’s an overreaction,” he said.

Peter Cardillo, chief market economist at Rockwell Global Capital, noted some volatility due to options expirations.

“At one point or another you’re going to see some bottom fishing,” he said. “Again, the trend for now is lower.”

Major averages 5-day performance

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Global markets extended losses on Friday. European stocks closed sharply lower, with the STOXX Europe 600 off more than 3 percent.

The Shanghai Composite plunged 4.2 percent after the China flash manufacturing PMI came in at a 6-1/2-year low.

“There’s a lot of systemic fear with growth slowing in China … but nobody really knows what the actual data is,” said John Caruso, senior market strategist at RJO Futures. “With China taking the drastic measure of actually devaluing their currency (last week) many people are believing things are much worse than they’re leading us on to believe.”

Read MoreRelax, we’re about to hit a bottom in stocks: Analyst

On the other hand, euro zone activity rose in August. The regional flash composite PMI from Markit rose to 54.1 from 53.9 in July. The U.S. flash manufacturing PMI came in at 52.9, slightly below expectations.

“I’d certainly be surprised if there’s not a bit of a bounce, because a lot of what we know is not new,” said Art Hogan, chief market strategist at Wunderlich Securities.

Treasury yields held lower, with the 10-year note yield at 2.05 percent and the 2-year yield at 0.63 percent.

The dollar fell about 1 percent against major world currencies, with the euro hitting a two-month high above $1.13 and the yen at 122.12 yen against the greenback. Emerging market currencies were weaker against the dollar.

Read MoreMarkets are in a technical mess

Growth fears and uncertainty about the timing of a Federal Reserve rate hike weighed heavily on Thursday. U.S. stocks plunged more than 2 percent, with the major averages closing at session lows below their 200-day moving averages. The Dow fell 358 points to below 17,000 and the S&P 500 ended at 2,035, in the red for the year so far.

“The SPX broke down from a triangle pattern yesterday on a significant increase in downside volatility. The decline led to a breach of important support at the March low, which defines the lower boundary of a six-month trading range,” said Katie Stockton, chief technical strategist at BTIG.

“An important low appears likely next week from a technical standpoint, although the market may reel for another couple of days before finding its corrective low,” she said.

On the earnings front, Deere and Foot Locker posted results before the market open.

Read MoreEarly movers: DE, FL, HPQ, GPS, CRM, SYY, NVS & more

Deere plunged more than 8 percent after posting earnings $1.53 per share for its third quarter, 9 cents above estimates. However, revenue was below forecasts and Deere also lowered its forward guidance. The company said it is being impacted by a downturn in the farm economy and lower demand for construction equipment.

Foot Locker fell 3.7 percent after reporting earnings of 84 cents per share for its second quarter, 15 cents above estimates. Revenue was above analysts’ forecasts as well, and a same-store sales increase of 9.6 percent exceeded estimates of a 6 percent rise.

The Dow transports fell 2.7 percent, with JetBlue leading all constituents lower. The index has been in correction territory for much of the year.

The Dow Jones Industrial Average closed down 530.94 points, or 3.12 percent, at 16,459.75, with Apple leading all blue chips lower.

The index has fallen 1,017 points this week and off 1,230 points for August. The index has only dropped more than 1,000 points or more in five other months in history, most recently in October 2008.

The S&P 500 closed down 64.84 points, or 3.19 points,, with information technology and energy leading all 10 sectors lower.

The Nasdaq closed down 171.45 points, or 3.52 percent, at 4,706.04.

About five stocks declined for every advancer on the New York Stock Exchange, with an exchange volume of 1.3 billion and a composite volume of 5.0 billion in the close.

High-frequency trading accounted for 49 percent of August-to-date’s daily trading volume of about 6.7 billion shares, according to TABB Group. During the peak levels of high-frequency trading in 2009, about 61 percent of 9.8 billion of average daily shares traded were executed by high-frequency traders.

CNBC’s Peter Schacknow contributed to this report

JEB BUSH: NSA NEEDS BROADER POWER, URGES TECH FIRMS TO COOPERATE

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by BILL BARROW | AP | AUGUST 18, 2015

Presidential candidate linked to drug cartels wants NSA to spy on your personal life

ATLANTA (AP) — Republican presidential hopeful Jeb Bush said Tuesday that the government should have broad surveillance powers of Americans and private technology firms should cooperate better with intelligence agencies to help combat “evildoers.”

At a national security forum in the early voting state of South Carolina, Bush put himself at odds with Republican congressional leaders who earlier this year voted to end the National Security Agency’s bulk collection of phone records.

The former Florida governor said Congress should revisit its changes to the Patriot Act, and he dismissed concerns from civil libertarians who say the program violated citizens’ constitutionally protected privacy rights.

“There’s a place to find common ground between personal civil liberties and NSA doing its job,” Bush said. “I think the balance has actually gone the wrong way.”

Bush also said the U.S. should send more troops — he didn’t say how many — and equipment to eastern European nations in response to Russia’s increasingly aggressive posture in the region. He said Russian President Vladimir Putin should know that his “adventurism” comes with “a price to pay.”

“Rather than reacting to the bad behavior, I think we need to be more forward-leaning as it relates to what the consequences will be,” Bush said.

The remarks were part of Bush’s ongoing efforts to pitch an aggressive foreign policy as he struggles to break out of a crowded Republican presidential primary in which businessman and former television reality star Donald Trump has garnered much of the attention.

Pushing a hawkish foreign policy is a staple of Republican presidential politics. The exception is Kentucky Sen. Rand Paul, and even the libertarian-leaning senator has refused to take military action off the table as he argues for a reduced American footprint around the world.

Yet for Bush, the discussion comes with particular challenges as he tries to distance himself from former President George W. Bush, the candidate’s brother, who signed the Patriot Act into law and oversaw the 2003 invasion of Iraq.

Congress voted in June to end the bulk collection of American phone records under the Patriot Act, a controversial program that NSA contractor Edward Snowden disclosed publicly in 2013. The Obama administration announced recently that the agency later this year would destroy all the remaining records that already had been collected.

Bush doubled-down Tuesday on his assertions that there is “no evidence” the data collection violated civil liberties. “I’ve found not one” case, he said.

The Privacy and Civil Liberties Oversight Board, an independent bipartisan agency, declared NSA’s phone records collections program illegal in 2014, and a federal court of appeals reached the same conclusion earlier this year.

A May analysis from the Justice Department found that FBI agents interviewed by the inspector general’s office “did not identify any major case developments” that came from using Section 215 that allowed the bulk records collection.

Bush also criticized private technology firms for using encryption to make it harder for their customers to be surveilled. “It makes it harder for the American government to do its job while protecting civil liberties to make sure evildoers aren’t in our midst,” he said.

Noting that companies like Google are getting pressure from customers, Bush said “market share … should not be the be-all-end-all,” and he called for “a new arrangement with Silicon Valley in this regard.”

Separately, Bush told CBS News that he disagreed with rival Donald Trump on the birthright of children born in the United States to parents who are immigrants living in the country illegally.

CLASSIFIED PENTAGON EXERCISES REVEAL U.S. WOULD STRUGGLE TO WIN WAR WITH RUSSIA

“It would take everything we had”

by PAUL JOSEPH WATSON | AUGUST 14, 2015

The Pentagon has been running a series of exercises throughout the summer based on a hypothetical ground war with Russia which reveal that the U.S. would struggle to defeat Moscow.

Two defense officials who refused to be named told the Daily Beast that Washington is not ready for a sustained conflict.

“Could we probably beat the Russians today [in a sustained battle]? Sure, but it would take everything we had,” one defense official said. “What we are saying is that we are not as ready as we want to be.”
The wars in Iraq and Afghanistan have depleted the U.S. Army’s ability to maintain a significant troop presence, the exercises revealed. There would also be little time to sufficiently train airmen for the conflict.

“Against an adversary like Russia, we can’t take the kind of air dominance we’ve had in conflicts since 9/11 for granted,” a second defense official explained. “Any conflict of significant magnitude against an adversary like Russia means we’d need to commit airmen and resources that are now operating in other parts of the world at a rate that minimizes their ability to train for that kind of fight.”
The revelation of the exercises follows a warning by a prominent think tank that the scale of wargame exercises currently being conducted by both NATO and Russia clearly suggests that conflict is on the horizon.

“Russia is preparing for a conflict with NATO, and NATO is preparing for a possible confrontation with Russia,” said Ian Kearns, director of the London-based European Leadership Network.

The fact that the Pentagon is even thinking about a hypothetical war with another superpower is concerning enough, but the revelation that such a conflict would potentially be unwinnable makes it more likely that the U.S. and NATO would choose a different option for toppling Putin – contriving a color revolution in Moscow.

Last month, Russian Parliament member Yevgeny Fedorov went public to reveal a plot on behalf of the US State Department to contrive a staged Kiev-style revolution that would force Putin to step down and lead to the collapse of the Russian Federation within two years.

Fedorov asserts that Russian oligarchs have been paid off to facilitate this coup, which will involve hundreds of thousands of people flooding the streets of Moscow to start a violent rebellion against Putin after a further collapse in the Russian economy causes food prices to soar.

Watch the video below for further information on how this color revolution could unfold.

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RUSSIA MOVES HUGE NUMBER OF TROOPS TO WESTERN BORDER

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Appears to be preparing for war in December

by KURT NIMMO | INFOWARS.COM | AUGUST 13, 2015

The official Russian government news agency reports the nation’s military is moving a large number of soldiers and equipment to the Western Military District.

“The General Staff and the Western Military District’s command have been working tightly on determining and specifying the personnel and hardware of the 20th combined army,” a military source told TASS.

“In particular, questions are being decided of complementing the army with units from other military districts and forming more mechanized infantry, armor, artillery, missile, reconnaissance and other brigades.”

The army will be “reformatted” by December 1st in the district that encompasses 2 million square kilometers of airspace and 3,000 kilometers along the border with Europe.
The Russian Air Force and Air Defense Army is armed with Sukhoi Su-34, Su-35S and Su-30MS jets, Kamov Ka-52, Mil Mi-28N, Mi-35, and Mi-MTV5 helicopters, and S-300, S-400 and Pantsir-S air defense systems, according to TASS.

Russia also plans to create a new tank army along the border. It will incorporate the Tamanskaya Mechanized Infantry Division and the Kantemirovskaya Tank Division, as well as the 27th Sevastopolskaya Mechanized Infantry Brigade and the 6th Tank Brigade.

Another tank army will be in place near Moscow by December 1st.

In addition, Russia will create a rapid reaction force of paratroopers that will coordinate with ground troops. According to the General Staff, the airborne troops will increase in size from 45,000 to 60,000.

In June NATO announced it would include around 40,000 troops in its rapid response Spearhead Force stationed in Eastern Europe on the border with Russia.

“The proposal would mark a significant increase in the number of NATO troops in the region, as there were just 4,000 troops there in 2014,” the International Business Times reported.

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WHY THE OBAMA TEAM CAN’T MAKE NATIONAL-SECURITY DECISIONS

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The US military now believes that Russian hackers, likely tied to the Putin regime, were behind last month’s massive cyber attack on the Defense Department’s e-mail servers

by NY POST | AUGUST 9, 2015

The US military now believes that Russian hackers, likely tied to the Putin regime, were behind last month’s massive cyber attack on the Defense Department’s e-mail servers. But don’t expect our government to respond.

After all, that news comes on the heels of White House-Pentagon battling over just how much of a threat Vladimir Putin poses.

Top US military commanders are imploring the administration to take seriously what Gen. Joseph Votel, head of the US Special Operations Command, calls an “existential threat” from Russia.

And Gen. Joseph Dunford, on track to be the next chairman of the Joint Chiefs of Staff, has concluded that “Russia presents the greatest threat to our national security.”

The latest cyberattack won’t move the White House, either. After all, Defense Secretary Ashton Carter admitted back in February that Russian hackers had broken into the Pentagon’s network.

Fact is, President Obama has a long history of ignoring military advice.

Forget older debates, when the president ignored the military (and even the State Department) on his pullout from Iraq, his “surge” in Afghanistan and giving serious help to the rebels early on in the Syrian civil war.

Obama is shutting out the professionals right now on anti-ISIS policy.

Army Chief of Staff Gen. Ray Odierno noted recently that the rise of ISIS under Obama is “frustrating to watch.”

The Marine Corps commandant, Gen. James Amos, slammed Obama last month for not “working with” the Iraqi government or military and lamented the “position” Obama’s policies have put the country in.

In January, just-retired Marine Gen. James Mattis deplored the “reactive crouch” the US military has been forced to take and noted that he didn’t know what “our policy is on Syria.”

Try finding anyone who does, general.

Add to this the furor at Defense, State and elsewere over Obama’s National Security Council — which insists on intervening in low-level decisions but seems unable to actually decide.

A Washington Post report last week is rife with anonymous quotes about “constipated” NSC policymaking that’s left the nation doing nothing for months amid crises from Syria to Ukraine to Egypt.

Our conclusion? This president only wants to seem to be getting tough on America’s enemies. He’s not trying to bluff them — but merely convince the US public he’s doing his job.

Give a speech here, throw in a drone strike there: Obama’s content with the appearance of action — and he’s not going to change.

The problems for the next president are going to keep piling up for the next 16 months.

Iran just did EXACTLY what John Kerry said would never happen

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by Allen West on August 8, 2015

Who was it that alluded to the maxim, “there’s a sucker born every minute”? Whomever it was certainly predicted the Obama administration and the Iranian Joint Comprehensive Plan of Action (JCPOA) deal.

First of all, it’s rather hilarious Barack Obama has now lumped in fellow Democrats — Sen. Charles Schumer of New York; Rep. Eliot Engel, Rep. Grace Meng and Rep. Nita Lowey, all of New York; Rep. Brad Sherman of California; and Rep. Ted Deutch of Florida — with hardline Iranian Islamists when it comes to the Iranian deal. See, these Democrat legislators have decided to stand against Obama and Kerry.

Now, I’m skeptical because the Democrats probably have done a whip count in the House and Senate and realize they’ve secured the votes to preclude a veto-proof vote against Obama. Remember, you only need 34 senators to get this folly through. But perhaps these individuals may just have a conscience — Chuck Schumer is set to be the senior Democrat senator.

I would like to believe these Democrats are recognizing this “deal” — and, remember, it’s not a treaty for ratification, thanks Sen. Corker of Tennessee. We’ve reported here that Iran’s making deals with Russia for aerial refueling tankers. We’ve reported here that Iran’s making deals with China for new fighter jets in exchange for the prized commodity of oil.

And here’s the latest revelation that the respect President Obama rails that he’s restored is only a pipe dream.

As reported by Fox News:

The shadowy Iranian Quds Force commander Qassem Soleimani recently visited Moscow to meet with senior Russian leaders, according to two Western intelligence sources, despite a travel ban and U.N. Security Council resolutions barring him from leaving Iran.  

On July 24, one week before Secretary of State John Kerry testified to the Senate Armed Services Committee and faced questions about the newly struck nuclear deal, Soleimani arrived in Moscow for meetings with Russian Defense Minister Sergei Shoigu and President Vladimir Putin. It was not immediately clear what the Iranian leader discussed, but the revelation comes as the United Nations and European Union arms embargo against Iran is slated to be lifted in five years as part of the comprehensive nuclear agreement announced July 14 from Vienna.  

Soleimani was first designated a terrorist and sanctioned by the U.S. in 2005 for his role as a supporter of terrorism. In October 2011, the U.S. Treasury Department tied Soleimani to the failed Iranian plot to assassinate the Saudi ambassador to the United States at a popular restaurant in Washington, D.C. The Quds Force is the special forces external wing of the Iranian Revolutionary Guard, responsible for supporting terrorist proxies across the Middle East. It reports directly to Iran’s Supreme Leader Ali Khamenei.

We reported to you here the assessment of my former Assistant Division Commander, LTG Michael Barbero, and his description of General Suleimani and the result of his exploits and interventions into Iraq for our men and women in uniform. Suleimani and his Quds Force supplied the explosively formed penetrator (EFPs) responsible for 20 percent of our troops’ deaths. He’s been recently photographed in Iraq — which is also a violation of his travel ban and resolutions. Then again, doesn’t Russia sit on the U.N. Security Council? So a member of the council that instituted the resolution hosted this death angel? What part of “sucker” do we not get?

Here’s verification:

Soleimani arrived in Moscow on Air Iran flight #5130, a commercial flight from Tehran, at 6:50 a.m. on July 24, a Friday. He left Moscow the following Sunday, July 26, at 10:25 p.m. on flight #5120, according to Western intelligence sources.

U.N. sanctions have not yet been lifted against Iran, and Soleimani, as head of the Iranian Quds Force is sanctioned as part of Security Council Resolution 1747. He is prohibited to travel, and any country that lets him transit or travel is defying the sanctions. (Russia is a permanent member of the Security Council and would have been aware of this restriction when meeting with him.) 

This is the Iran with whom Obama’s trying to tell us we secured the best possible “deal”? This is the Iran about which Obama ranted on earlier this week, fear-mongering that the only alternative for America was war.

Hey, message to Barack Obama, these guys are planning war anyway and now they’re going to have allies in Russia and China. Look, the Quds force is a modern day Nazi Secret Service, and Suleimani is today’s Henrich Himler — and he’s just flying around all over the place it seems.

And this is yet another example of Vladimir Putin’s disrespect and dismissal of one Barack Obama — whose weakness in enticing and emboldening.

So what would General Suleimani be doing in Russia talking with the defense minister and Putin?

Simple, S-300, the advanced anti-aircraft surface to air missile system, we have reported on that here as well. If Iran secures these systems, Katie bar the door, it will be hellacious business for anyone to strike the Iranian nuclear program. Remember, the program the United States is not allowed to be on an inspection team to verify? Anyway, based on the agreement, the United States is bound to protect Iran’s nuclear program anyway. What was that thing about being a sucker?

So if Obama wants to liken opposing voices to this deal with Iranian hardliners, to whom do we liken Obama, Kerry and those who support this inane, horrific foreign policy endeavor? Outgoing U.S. Army Chief of Staff Gen. Ray Odierno characterized the Iranian general in an exclusive exit interview with Fox News:

Qassem Soleimani is the one who has been exporting malign activities throughout the Middle East for some time now. He’s absolutely responsible for killing many Americans, in fact I would say the last two years I was there the majority of our casualties came from his surrogates, not Sunni or Al Qaeda.

Sen. Tom Cotton asked Secretary of State John Kerry on July 29 — five days after the Iranian leader’s Moscow visit — about Soleimani receiving sanctions relief. Secretary Kerry responded: “Under the United States’s initiative, Qassem Soleimani will never be relieved of any sanctions.” Seems to me that Suleimani did indeed relieve himself — all over John Kerry and Barack Obama, as he flew to Russia and back, probably first class.

Now I’m sure our liberal progressive detractors will simply state, what difference at this point does it make? The left will go to any lengths to disparage anyone not falling in line with Obama and his demands. However, even a sucker has to admit when they’ve been suckered.

You’d think if Obama had just a drop of American pride he’d call an immediate press conference and say, “Due to Iran’s belligerent actions since the signing of the Joint Comprehensive Plan of Action, I’ve determined the Iranian militant Islamic theocratic regime cannot be trusted. I’m nullifying the JCPOA and will seek to restore and increase economic sanctions upon Iran, as well as employ a naval blockade. We shall not relieve these actions until Iran’s theocratic rule has ended; all options are on the table to enable that end state. I admit, I was wrong, and believed we could seek a diplomatic solution with the largest state sponsor of terrorism. Furthermore, I am demanding the four Americans held hostage by Iran be released in 48 hours or I will unleash hell.”

Yes, I know, like the Aerosmith song, “Dream On.”

Folks, as I stated in Times Square: President Obama, there’s a reason why no one’s ever sought to do what you have done. It’s a damn stupid thing you have done.