Amazon loses money every sale, but they make it up on volume. From David Stockman at davidstockmanscontracorner.com:
As far as we can tell, Jerome Powell is worse than Janet Yellen with a tie. That’s because he is the kind of Swamp based RINO (Republican in name only) who has no clue that Keynesian central banking is a mortal threat to capitalist prosperity; and because his history as a crony capitalist beneficiary of that regime at the Carlyle Group has left him blind to the wanton destruction it is unleashing.
Since there is a small chance that the Donald’s glandular impulses may accidentally do the world a favor and opt for Kevin Warsh as the next Fed chairman on Thursday morning, we will hold off on the hell and brimstone denunciation that Powell deserves. After all, no one with an inkling about sound money and honest price discovery would have voted 45 straight times for the money printing depredations of Ben Bernanke and Janet Yellen as did Powell during his tenure on the Fed since 2012.
But when it comes to wanton destruction we can think of no better evidence than the $63 billion market cap eruption visited upon Amazon (AMZN) owing to its purported “blow-out” earnings report on Friday.
Except it wasn’t all that. Not remotely.
In the year ago quarter AMZN’s pre-tax earnings came in at $491 million, which was actually alot more than the $316 million figure posted for Q3 2017. In fact, the company’s niggardly profits during the current quarter represented a 36% plunge from prior year, but thanks to its tax cut “selfie” the headline reading robo-machines didn’t even notice this rather dramatic setback.
To wit, AMZN effective tax rate plunged from an aberrantly high 46.6% last year to a quite low 18.4% this year. As a result, its reported net income remained exactly flat relative to prior year—even though it sales jumped by $11 billion (in part due to the Whole Foods acquisition).
Stated differently, the blow-out earnings figure of $0.53 per share reported Friday was the very same $0.53 per share reported last year. Alas, the “blow-out” part was due to the “beat” from the $0.02 street consensus.
Then again, the street consensus had been for $1.91 per share only 90 days ago!
As per usual, it had been “guided “down by 99% in the interim. If nothing else, this proves that the whole SEC “Fair Disclosure” (FD) regime is an absolute farce and that the SEC itself is an utter waste of taxpayer money.
To continue reading: A Monstrous Bubble—The Destroyer Called Amazon