Rick Santelli Rages: "What Is Bernanke So Afraid Of?"
Submitted by Tyler Durden on 06/19/2013 - 11:48
The following three minutes of absolute perfection uttered by CNBC's Rick Santelli is dangerous for anyone living in Kyle Bass' "intellectually dishonest" alter-world of denial and "unicorns and rainbows" as the Chicagoan goes off on the ignorance of everyone in these so-called markets. When every talking head is bullish and the world is going so great that we should all "buy stocks," Santelli demands we ask Bernanke - "what are you scared of," that keeps you pumping this much money into the system for this long? Simply put, Santelli's epic rant is the filter that every investor (or member of the public) should be viewing financial media and the Fed today (or in fact every day).
- Comments: 121
- Reads: 14,582
"I'd Suggest Not" - On The Editorial "Back-And-Forth" Between Jon Hilsenrath And The New York Fed
Submitted by Tyler Durden on 06/19/2013 - 12:21Three years ago we wrote "On The New York Fed's Editorial Influence Over The WSJ" in which we observed, courtesy of declassified documents by the Sigtarp exposing the involvement of then-Goldman and New York Fed director Stephen Friedman in relation to his infamous purchase of Goldman Stock so well memorialized by none other than Jon Hilsenrath (a story which made him a Loeb award finalist when he actually did investigative work instead of merely convey messages from the Fed), just how extensive the relationship between Jon Hilsenrath, the WSJ and the New York Fed was. But instead of regurgitating all the minutae covered in the original post (read it here), we will cut to the chase and present the declassified emails between the WSJ team in April/May 2009, and the NY Fed's Calvin Mitchell, then-EVP of the Communications Group, as well as the Fed's internal involvement of the FRBNY's General Counsel Thomas Baxter. We have highlighted the NY Fed "suggestions" - they are self-explanatory.
- Comments: 13
- Reads: 3,249
Dolce And Gabbana Sentenced To 20 Months In Jail For Hundreds Of Millions In Tax Evasion
Submitted by Tyler Durden on 06/19/2013 - 11:30
The latest casualty of Europe's berserk pursuit of tax evaders everywhere: not some Russian oligarch with a $1 billion Cypriot bank account but famous Italian designers, Dolce and Gabbana. WSJ reports that a Milan court has convicted the designers Domenico Dolce and Stefano Gabbana of tax evasion. The pair were found guilty Wednesday of failing to declare €1 billion ($1.3 billion) in income tax to authorities. The court sentenced them both to one year and eight months in jail.
- Comments: 63
- Reads: 5,789
Drones Are Used For Domestic Surveillance, FBI Director Admits
Submitted by Tyler Durden on 06/19/2013 - 11:04
Not sure if this one fits with the "fairness doctrine" or the "inconvenience" paradigm (where the government is here to protect you in exchange for ceding all those pesky constitutional amendments), but moments ago yet another "conspiracy theory" become fact when the FBI director Robert Mueller admitted to the domestic use of drones for surveillance purposes.
- Comments: 117
- Reads: 8,450
500 Years Of (Mostly Rising) Energy Prices
Submitted by Tyler Durden on 06/19/2013 - 10:53
Starting with Wood from 1500 to present day Coal and Oil prices; here is 513 years of Energy source prices...
- Comments: 87
- Reads: 8,349
"Fed In A Box" - Vince Reinhart's FOMC Probability Matrix
Submitted by Tyler Durden on 06/19/2013 - 10:24
Since the only topic on everyone's mind until 1:59:59:9999 pm today (excluding those who have been leaked the FOMC decision in advance of course) will be what the Fed will do, here are some additional perspectives from former FOMC secretary and economist Vince Reinhart (currently at Morgan Stanley), who believes nothing happens today as the Fed has "boxed" itself in, and his Fed Statement Probability Matrix.
- Comments: 52
- Reads: 13,065
Guest Post: The Bloom Has Fallen Off The Brazilian Rose
Submitted by Tyler Durden on 06/19/2013 - 09:55
With better access to credit, housing, jobs and overall standard of living than probably anyone in their family has ever experienced, you would think that the average Brazilian would have little reason to hit the streets. And yet, they are. While the credit-fueled boom has been great and looks likely to continue for at least a little while longer, the reality of a government that has made little real progress improving the overall standard of living is becoming all too obvious. The protestors are frustrated. Frustrated with persistent inflation – that hits them much harder than the upper classes who in many ways benefit from it. Frustrated with corruption – while the Brazilian congress tries to pass a law that would limit the number of corruption cases that can be brought. Frustrated with inefficient government – the infrastructure development for the World Cup and Olympics is already running up against cost overruns with projects of questionable long-term value. But mostly frustrated that due to all of this incompetence, they could lose all of the gains they made since 2002. Changing Brazil’s well-established rich/poor, connected/unconnected, boom/bust political and financial system will be difficult in the extreme.
- Comments: 86
- Reads: 6,065
"A Classic Minsky Trap Appears To Have Developed"
Submitted by Tyler Durden on 06/19/2013 - 09:06
For the past several years, a firmly entrenched psyche of ‘win-win’ for risk-taking behavior has dominated. The thinking has been that the Fed would either help achieve a sustained recovery (allowing distorted prices to be validated by economic fundamentals), or the FOMC would provide more price-boosting liquidity. Now, faith in this proposition is slowly being eroded. Global central banks have collectively provided $11 trillion in liquidity over the past several years. The initial moves were taken to spark domestic demand, but some recent external actions have been retaliatory in nature, implemented as a means to influence currency levels. These new forms of hostilities are indications that the external ramifications of QE policies may no longer be passively tolerated.
- Comments: 91
- Reads: 13,479
Obama Addresses Germany: Ich Bin Ein Berlistener - Live Webcast
Submitted by Tyler Durden on 06/19/2013 - 09:02
Almost 50 years ago, JFK immortalized the donut with his comment "Ich bin ein Berliner," with pressure from Merkel to come clean on the NSA's efforts, we wonder if the current US President will admit, "Ich bin ein Berlistener," as he delivers a speech from The Brandenburg Gate.
- Comments: 101
- Reads: 6,226
Why Housing Is The Economy's Last Best Hope
Submitted by Tyler Durden on 06/19/2013 - 08:41
The housing market 'recovery' has provided substantial support to the U.S. economic growth. The housing-related activities, which Guggenheim's Scott Minerd defines as private residential investment, personal expenditures on household durable goods, and utilities, as well as consumption wealth effect from home price appreciation, have positively contributed to real GDP growth for five consecutive quarters. In the first quarter of 2013, housing-related activities contributed more than half of the growth in the real GDP. That seems a significant burden to be carrying for a sector now seeing data disappointing already expectations, mortgage applications plunging, furniture sales plunging, and REIT IPOs being pulled.
- Comments: 47
- Reads: 6,279
"It's A Massacre" - Each Day 134 Retail Outlets Close In Italy
Submitted by Tyler Durden on 06/19/2013 - 08:13
If anyone is still not convinced that surging stock bourses in Europe are indicative of anything more than central bank liquidity, carry trade allocation and localized asset bubbles, we present a snapshot of what is actually happening on the ground via Italy's Ansa: "It's a massacre," said Confesercenti President Marco Venturi. "Each day 134 shops, restaurants and bars close in recession-hit Italy, retail association Confesercenti said on Wednesday. Confesercenti, which represents small and medium-sized businesses in the retail and tourism sectors, said 224,000 enterprises had closed their shutters since the start of the global economic crisis in 2008.
- Comments: 91
- Reads: 10,720
FOMC Scenarios And What's Priced In
Submitted by Tyler Durden on 06/19/2013 - 08:02
While Fed officials are at pains to point out that their two policy tools (asset purchases and rates) the markets continue to link them and the latest increase in Taper chatter has dragged expectations for the first rate hike dramatically forward. Just a month ago, expectations were as late as Jan 2016 but Fed Funds futures have collapsed in recent weeks to imply rate hikes begin in Jan 2015 - a level of 'tightening' not seen since early Summer last year. Bernanke has stated that his communication is aimed at "reducing the risk that market misperceptions of [FOMC] intentions would lead to unnecessary interest rate volatility," but just as with Kuroda, the market seems to not be agreeing and, as we note below, there appears a good, bad, and ugly 'taper' scenario for today.
- Comments: 24
- Reads: 10,639
Frontrunning: June 19
Submitted by Tyler Durden on 06/19/2013 - 07:40- China cash crunch deepens as PBOC withholds funding (FT), just a week behind ZH
- Platts in hot manipulated crude again: Traders Try to Game Platts Oil-Price Benchmarks (WSJ)
- Kabul Suspends Security Talks With U.S., jeopardizing plans to maintain a U.S. military presence (WSJ)
- Afghan government irked over U.S. talks with Taliban (Reuters)
- BOJ Kuroda: BOJ to Adjust Policy If Japan Econ Changes (MNI)
- Google Considering Private-Equity Alliances (BBG)
- Korean Air Buying 747-8s to End Boeing’s Sales Drought (BBG)
- Syria's Islamists seize control as moderates dither (Reuters)
- SEC considers policy shift on admissions of wrongdoing (FT)
- U.K. Banker Bonuses Face Decade Delays in Industry Overhaul (BBG)
- Comments: 6
- Reads: 2,392
Obama Explains In Germany Why The NSA Is Eavesdropping On Germans - Live Webcast
Submitted by Tyler Durden on 06/19/2013 - 07:08
50 years ago to the week, when JFK spoke in Berlin, his speech made history. Today, the US president is in Germany again... and in a far less historic and moving speech is scrambling to explain why the NSA is listening to and recording all German communications. Watch it live below.
- Comments: 120
- Reads: 10,002
Follow The Bouncing Fed
Submitted by Tyler Durden on 06/19/2013 - 07:04While all eyes and ears will conveniently and expectedly be on the Fed announcement and press conference in a few hours, the real action continues to take place in China, where the liquidity crunch is becoming unbearable for the local banks (and will only get worse the longer Bernanke and Kuroda keep their hot money policies). The CNY benchmark money-market one-week repo rate was 138bp higher overnight to a 2 year high of 8.15%. The 7 day Interest-Rate swap rose for a record 13th day in a row jumping +10 bps to 4.08%, the highest since September 2011. China sold 10 Year bonds at a 3.50% yield, above the 3.47% expected, and at a bid to cover of 1.43 which was the lowest since August 2012. Moody’s commented that local government financing vehicles (LGFVs) pose significant risks to Chinese banks. LGFVs accounted for 14% of loan portfolios at end-2012 according to Moody’s.
- Comments: 13
- Reads: 3,874
