What Could Possibly Go Wrong

The Fleeting Beauty of Bubbles and Bonds

"The political calculus is simple: the bottom half of households don't vote, don't contribute to political campaigns and don't have enough income to borrow huge sums of money to enrich the banks. They are thus non-entities in the fiscal-monetary project of maintaining the power structure of the Status Quo. All the Status Quo needs to do is borrow enough money to fund social programs that keep the masses passive and silent. Unfortunately for the Powers That Be, the cost of placating the rapidly increasing marginalized populace is rising much faster than tax revenues." Continue reading →

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Kyle Bass: “The Next 18 Months Will Redefine Economic Orthodoxy For The West”

"The topics he focuses on are Central bank expansion (with a mind-numbing array of awe-full numbers to explain just where the $10 trillion of freshly created money has gone), Japan's near-term outlook ('the next 18 months in Japan will redefine the economic orthodoxy of the West'), and most importantly since, as he notes, 'we are investing in things that are propped up and somewhat made up,' the psychology of negative outcomes. The latter, Bass explains, is one of the most frequently discussed topics at his firm, as he points out that 'denial' is extremely popular in the financial markets." Continue reading →

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How the Federal Reserve Just Hid Important Data

"One of the most important data points released by the Federal Reserve has been the amount of excess reserves sitting at the Federal Reserve. This is important data because these reserves are sitting at the Fed and not in the economy bidding up goods and service. If banks start pulling this money out of the Fed and making loans with the money, the money supply will explode, as well as price inflation. This must be watched closely. But notice something about this chart, the chart title says the series is discontinued. Got that? One of the most important data points is no longer reported by the Federal Reserve." Continue reading →

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Japan Resorts To Teenage Girls In Short Skirts To Get Their Stocks Up

"To get an idea of how Japan's prime minister, Shinzo Abe, is faring in his quest to lift his country out of two decades of stagnation, look no further than the skirts of the girl group Machikado Keiki Japan. The band, whose name translates roughly as 'street corner economic conditions', became a bellwether for the health of the world's third biggest economy earlier this year when they promised to shorten their skirts every time the country's stock market made significant gains. Their debut single, Abeno Mix – complete with unlikely singalong references to quantitative easing and construction bonds – takes its cue from Abenomics." Continue reading →

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Bill Bonner: The Making of a Modern Debt Slave…

"Deny a young person work and you deny him a career. Deny him a career and you deny him a way to support a family. Deny him a family life, and who knows what happens? In China, the 'bare branches' – young men who couldn't find wives – started a revolution. The Nien Rebellion, which took place between 1851 and 1868, cost 100,000 dead and almost toppled the Qing Dynasty. Will today's young people accept their lot... and remain in docile debt servitude their whole lives? Or will they rise up, as Mr. Graeber suggests, and burn T-bonds in public spaces... rampage down Wall Street... and perhaps hang Ben Bernanke in front of the New York Federal Reserve?" Continue reading →

Continue ReadingBill Bonner: The Making of a Modern Debt Slave…

Fred Reed: Ain’t Nobody Gonna Like It

"Watching the Zimmerman trial, I wonder whether we may not be in for big trouble. Racial hostility is much higher in the United States than it is allowed to appear. In the Twittersphere there is much traffic from blacks, saying that if Zimmerman walks, they will kill him themselves, riot, or kill random whites. On many sites around the web, whites of a sort not found on NPR are saying, 'Bring it on.' This is not your granny’s recipe for domestic tranquility. Let’s not kid ourselves. Race underlies almost everything in this country that spends half its time denouncing racism. This is true of trials, and particularly true of show trials." Continue reading →

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Third-Largest US Futures Broker Newedge Fined for Lax Oversight of Manipulative Trades

"The brokerage allowed potentially manipulative trading such as 'spoofing,' in which firms place orders designed to trick other firms into buying or selling stocks. Finra said clients also engaged in multiple 'wash trades,' in which a firm acts as buyer and seller in the same trade, creating the illusion of heavy trading volume that lures firms that are tracking for such activity. Finra last August implemented a sophisticated market-surveillance system that already has sparked nearly 300 investigations. The SEC is using a new market-monitoring system called Midas to track trading across stock exchanges." Continue reading →

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Not All Insurers Game for State Exchanges: The Consumer Impact

"As more insurers decide to pack up and leave certain states as health exchanges start to take form, experts say consumers are going to be left feeling the pain. Over the last few weeks, several departure announcements have sent a ripple through the health insurance industry, as companies weigh whether or not they want to play ball under Obamacare. So far, California has experienced the biggest migration with Aetna (AET), UnitedHealthcare (UNH) and Cigna (CI) leaving the state’s exchange, Covered California. Fifteen states and D.C. are in the process of creating their insurance exchanges before the 2014 deadline; when individuals must purchase insurance or face a fine." Continue reading →

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U.S. to deliver F-16 fighters to Egypt despite recent upheaval

"The United States is pressing ahead with plans to deliver four F-16 fighters to Egypt despite a military coup against President Mohammed Morsi. 'It’s still the status quo,' the official, who spoke on condition of anonymity, told AFP. There was no decision to halt the scheduled transfer of the warplanes or to cut off other security assistance to Egypt, the official said, even though the US government has announced a review of all aid to Cairo. The State Department said previously planned assistance would continue to flow to Egypt. 'We’re still paying our bills, of course, and all of the programs are still moving forward,' spokeswoman Jen Psaki told reporters." Continue reading →

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Why marijuana taxes are such a burning question

"In November, Colorado voters will decide on a proposed 15% excise tax, plus a 10% state sales tax, on all retail cannabis sales. In addition, Denver might levy its own 5% tax on pot sales made within the city. City officials say that 5% tax, along with other fees and state revenue, could add over $9 million annually to Denver's coffers. But advocates for legal marijuana say excessive taxes will drive people away from state-controlled cannabis and back to the black market. 'When you start thinking about it, in terms of what that's going to do to the cost to the consumer for cannabis, it's pretty ridiculous,' says Westword, Denver's weekly alternative paper." Continue reading →

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