The Trouble with Cash

Monetary policy has now become like a pressure cooker with a defective safety-valve. Central bankers realise it and investors are slowly beginning to as well. Add into this mix a faltering global economy, a fact that is becoming impossible to ignore, and a dash-for-cash becomes a serious potential risk to both monetary policy and the banking system. There is an obvious alternative to cash, and that is to buy physical gold.

How China's Banks Hide Trillions In Credit Risk: Full Frontal

According to Fitch, nearly 40% of credit in China is outside bank loans, meaning that between forced roll-overs, the practice of carrying channel loans as "investments" and "receivables", inconsistent application of loan classification norms, and the dramatic increase in off balance sheet financing, the 'real' ratio of non-performing loans to total loans is likey far higher than the headline number.

3 Things: The Labor Hoarding Effect

While massive binges in stock buybacks and accounting gimmicks have continued to blur the actual profitability of businesses, the decline in jobless claims suggests that there is little room from further reductions in body counts. However, that does not mean that businesses must begin rapidly increasing employment and wages. Businesses are indeed hiring, but prefer to hire from the "currently employed" labor pool rather than the unemployed masses. The "bad news" is that for those unemployed, full-time employment remains elusive, and wages remain suppressed due to the high competition for available work.

Seymour Hersh Slams Establishment Media: "I Am Not Backing Off Anything I Said"

"...if anyone didn’t think the president was going to f##k [the Pakistani military] they are out of their mind. He was always going to f##k them.... The White House has been very clever about this. They have gone after me personally. They don’t like me boo hoo hoo.... Don’t turn this into some sort of profound anti-American statement."

McCain Joins Ukraine Advisory Committee Headed By Georgia's Fugitive Ex-President

John McCain may find himself 'back in the (former) USSR' more frequently as the Senator landed on Ukrainian President Poroshenko's list of advisers along with former Georgian President (and current fugitive) Miheil Saakashvili. This should give McCain an opportunity to realize his dream of turning the 'conflict' with Russia into a proper war that self-respecting hawks can be proud of.

Yet Another Chart That Whimpers "Recession"

It's worthwhile recalling that mainstream economists, the Federal Reserve, government agencies and the mainstream financial media all deny the economy is in recession until it falls off a cliff.

Miami Beach Cops Caught Exchanging 100s Of Racist, Pornographic Emails

Just as race relations in America leave the front-pages for a day - as the news cycle briefly and sadly focuses on Amtrak - Miami Beach police department drags the nation back into debate. According to Miami-Dade State Attorney Katherine Fernandez Rundle, more than a dozen Miami Beach Police officers exchanged numerous racist and pornographic emails. "This is a very sad day for Miami Beach," Mayor Levine concluded, after Rundle explained that the officers are involved in 540 cases, with about 30% of them involving black defendants.

Even The FDIC Admits It's Not Ready For The Next Banking Crisis

The FDIC explains, banks have grown far larger and even more complex since 2008, and that "[s]uch trends have not only continued, they accelerated as a result of the crisis." The FDIC goes on to suggest that its current tools and business model are “not sufficient to mitigate the complexities of large institution failures." Not only are they not equipped to handle it, they’re not entirely sure what to do: that’s why the FDIC is "seeking comment on what additional regulatory action should be taken..."

"Obama's Tax-The-Rich Plan Is Futile" Druckenmiller Warns, America's Aging Population Is A "Massive, Massive Problem"

"Young people are not going to be talking about cutting back," exclaims billionaire hedge fund manager Stanley Druckenmiller, ominously concluding "there will be nothing to cut back." The reason he is so doom-full about the future - an aging population will present a "massive, massive problem" for the U.S. in 15 years - as Bloomberg reports, because of demographics, "we're just using more and more of society’s resources to fend for the old people," warning that Obama's plans to tax the rich to pay for more social services for the poor would be futile.

Will A Spike In Rates Hurt Stocks? (Spoiler Alert: Yes)

The current consternation among global equity markets is centered around the recent considerable rise in bond yields globally. Historical precedents, or the lessons they contain, which bear some resemblance to present market conditions suggest the recent spike in bond yields would appear to have historical evidence to back up those who harbor concerns about its potential negative impact on stocks – a negative impact that may be of a long-term nature.

Flash Crash Scapegoat Nav Sarao Complained More Than 100 Times About The Real Market Manipulators

Several weeks ago, when the CFTC and DOJ's laughable attempt to scapegoat the May 2010 flash crash on the actions of a live-in-his-parents-basement UK trader, we explained "Why Sarao Is The Flash Crash Patsy: He Threatened To Expose The "Mass Manipulation Of High Frequency Nerds." It now turns out that he not only threatened to expose the real market manipulators, but he acctually did it. More than 100 times.

Senate Passes Obama's TPP Fast-Track Trade Proposal

Two days ago there was some rejoicing and much surprise when the "Warren-faction" of Senate liberals turned against Obama, and failed to vote for a fast-track approval of the TPP. That surprise lasted for about 48 hours when moments ago, in a 65-33 vote, the Senate finally advanced a measure allowing Obama to expedite approval of trade agreements, a bill with bipartisan support in that chamber which however according to Bloomberg may run into strong opposition from House Democrats.

A View From The Valley - Are We Approaching Peak Optimism?

Sitting in Silicon Valley, it feels like we’ve reached the peak again. Hot money is chasing deals at ridiculous valuations. Housing prices are more than incomes can cover. Optimism is high. Jobless Claims are at cyclical lows. We’ve seen this before, in 2000 and 2007.

The Recovery Itself Unravels; Consumer Recession

If March was supposed to herald at least the beginning of the anticipated yearly rebound, April put that idea to rest. We have pushed way past last year’s “aberration” in the polar vortices and way past even the immediate aftermath of the 2012 slowdown (which hit in the also-snowy winter of 2013). You can make the argument that the full US economy is not in recession but it is now exceedingly difficult to sustain any position that doesn’t put the consumer already there.

Former NATO Commander, Presidential Candidate Makes Millions Pushing Penny Stocks

Gen. Wesley Clark has been a busy man since retiring from public service with a plan to make $40 million. In addition to chairing notorious investment bank Rodman & Renshaw, the former NATO allied commander and one-time Presidential hopeful has thrown his face and fame behind a plethora of OTC-listed companies, Bloomberg reports. From grilled cheese sandwich trucks to hydroponic lettuce companies run by the real-life Bud Fox, Clark's name has become so synonymous with doomed penny stocks that one fund manager calls his very appearance on a company board "a red flag."