China Demands Gold As Collateral For Zimbabwe Loans

China, as we noted here, is happy to provide the financing to turn Africa into Disneyland - Monorails and all - but there is one catch... the loans must be backed by gold as collateral. As The Source reports, China wants Zimbabwe to use its mineral proceeds to guarantee any future loans having already extended nearly $1.5 billion in the last three years to Harare’s ailing economy. Various minerals have been discussed to back the loans "but we feel gold is more stable," Zimbabwe's Mines Minister noted. Of course, China is defending the demand, claiming "it’s in accordance with rules and regulations when granting any loan" and adding that "it doesn’t mean that we will use the collateral." But one has to wonder how likely it is that Zimbabwe will promptly repay billions of dollars of loans - given their track record - and what a great way for China to transform its excess USDs to Gold (and get paid interest while it waits).

The Shocking Increase Of College Tuition By State

Our condolences to students in Arizona, who have seen a near doubling of their college tuition in just 5 short years. In fact our condolences to students in the six states where tuition have risen by more than 60%, in the ten states where it has increased by more than 40%, and in the 29, or more than half of all states, where college tuitions have risen by more than 10 times the Fed's inflation target of 2% per year.

Guest Post: False East/West Paradigm Hides The Rise Of Global Currency

Despite popular belief, very few things in our world are exactly what they seem. That which is painted as righteous is often evil. That which is painted as kind is often malicious. That which is painted as simple is often complex. That which is painted as complex often ends up being disturbingly two dimensional. Regardless, if a person is willing to look only at the immediate surface of a thing, he will never understand the content of the thing. This fact is nowhere more evident than in the growing “tensions” between the elites of the West and the elites of the East over the crisis in Ukraine. The centralization of power is best achieved during moments of bewildering calamity. The conjuring of crises is one of the oldest methods of elitist dominance. Not only can they confuse and frighten the masses into malleability, but they can also ride to the public’s rescue as heroes and saviors later on. The Hegelian dialectic is the mainstay of tyrants.

House Votes To Hold Former IRS Official Lois Lerner In Contempt, Seek Special Prosecutor

Just 3 days short of the one year anniversary of Lois Lerner refusal to testify about the IRS' improper targeting of conservative groups applying for tax-exempt status, House Republicans have voted to hold her in contempt of Congress, and

  • *HOUSE VOTES TO ASK FOR SPECIAL PROSECUTOR TO INVESTIGATE IRS

As NBC reports, In a partisan 231-187 vote, the House passed the contempt resolution, sending the matter to the U.S. Attorney for the District of Columbia. However, as The American Center for Law and Justice (ACLJ) repidly noted, "Unfortunately, we don't expect the Attorney General to move forward with this case, he has put politics above the enforcement of the law on numerous occasions and unfortunately that is likely to occur again."

The Fed's Three Heresies According To Jim Grant

In three concisely-worded, precisely-defined, factually-correct minutes, Jim Grant not only deconstructs Janet Yellen's mumblings this morning but explains how each of the Fed's three beholden doctrines...

  1. We believe in price control
  2. We believe in market manipulation
  3. We believe in the Phillips Curve

...have been discredited as heresies over time; and, as Grant so poetically notes, Yellen "did not touch on the moral quandary that low interest rates introduce into our country - grandmothers, grandfathers, savers are figuratively on their hand and knees and rooting around in bushes and between sofa seats for lose change on which to sustain themselves."

Department Of Defense To Study Bitcoin As A "Terrorist Threat"

A division of the U.S. military known as the Combating Terrorism Technical Support Office (CTTSO), which studies threats to national security (i.e., the status quo’s grip on power) has listed Bitcoin amongst a number of potential terrorist threats. Of course, as we and many others have noted repeatedly, anything which threatens the prevailing criminal status quo will be merely labeled a “terrorist threat” in order to neutralize it. Just in case you aren’t yet convinced of how insane the folks at CTTSO are, “also on the CTTSO’s list of terrorism research topics were Android, Motorola, social media and virtual reality.” What has happened to this country...

Jeff Gundlach's Bearish Homebuilder Call (In 1 Chart)

While Jeff Gundlach's against-mainstream-consensus bearish call on the homebuilders (and over-rated housing recovery) will come as little surprise to regular readers of Zero Hedge, we thought the following chart might provide one more simplifying perspective on his call for lower prices in homebuilder stocks...

Two More Theories To Explain The "Treasury Bond Buying" Mystery

With everyone and their mom confused at how bonds can rally when stocks (the ultimate arbiter of truthiness) are also positive, we have seen Deutsche confused (temporary technicals), Bloomberg confirm the shortage, and BofA blame the weather (for a lack of bond selling). Today, we have two more thoughtful and comprehensive perspectives from Gavekal's Louis-Vincent Gave (on why yields are so low) and Scotiabank's Guy Haselmann (on why they' stay that way).

Tesla, Which Has First Model S Sales Decline Since 2012, Explained In Three Charts

While Tesla's financial results will hardly be much discussed by either the bulls or bears who follow the company - because it is one of the last remaining "story" stocks - and most will instead focus on the fact that Tesla sold 6,457 Model S cars in the quarter, down 6% from the 6,892 sold in Q4 2013, and the first sequential sales decline since 2012 (Is Tesla about to be Twittered?), here are, for the purists, the only three charts that matter.

Late-Day Buying Panic Saves Russell From 3-Month Lows

In a word... "mixed" Early ugliness gave way to another ramp job courtesy of USDJPY's 101.50 level holding - which managed to clamber the Dow to unchanged on the week and stabilize the S&P (after it bounced off its 50DMA). But... Nasdaq and Russell just could not get it together until the last few minutes  thanks to a VIX slam, JPY ramp and 30Y dump. Yellen's testimony pushed some volatility through markets and perhaps provided the extra pressure on the small caps (after warning of valuations). The term structure steepened modestly with 30Y +1.5bps and the rest of the curve rallying 2-3bps (10Y unch). The USD rallied modestly off 19-month lows. Gold had its worst day in 3 weeks, breaking below 1300 and testing its 100DMA (tick for tick with silver on the day). Oil prices jumped back up to around $101 as Copper slipped back towards $3. And finally, we hesitate to mention it... today's market schizophrenia was enough to trigger a Hindenburg Omen.

 

Almost Half The Russell 2000 Members Are In A Bear Market

With market internals dismally weak and 967 of the Russell 2000 index's members down over 20% from their highs (a bear market), the question is: how long can they maintain the status quo thanks to a handful of big blue chips as levered longs attempt to stay solvent?

94% Of March Consumer Credit Was For Student And Car Loans

Another month, another confirmation that when it comes to the US consumer, it is all about student debt (and to a lesser extent, car loans). Moments ago the Fed reported that consumer credit number for March: at $17.5 billion, it not only blew out the expectation of a $15.5 billion increase (although when one adds last month's $3.5 billion downward revision to $13.0 billion the two month total actually missed), but was the highest monthly increase since February 2013. That's the good news. The bad news was once again in the composition: of this $17.5 billion $16.4 billion was non-revolving debt, or about 94% of total. The "good", or revolving, credit card debt? Only $1.1 billion.

The Latest Victim Of The Ukraine Crisis: Beer

Everyone knows that when it comes to apologists and scapegoats, Q1 was all about weather excuses, and as SocGen already showed earlier today when it took a $730 million charge on its Russian subsidiary, Q2 misses will all be Ukraine's fault, which is ironic because as recently as a month ago experts were screaming over each other how little Ukraine matters for the global economy, how meaningless Russian exposure is to western banks and so on. But while one can at least superficially justify a bank provisioning against deposit flight and the accumulation of bad debt in a country in which paying one's debt is the last thing on the population's mind, a new and quite different victim of the Ukraine crisis was revealed earlier today when beer titan Carlsberg swung to a net loss and issued a profit warning: beer.

Swiss Bureaucrats In Gold Panic

There should be no 'flexible currency' and no central planning of money. They are at the root of the boom-bust cycle, the very reason for the various crises that have beset Western economies in recent decades. Switzerland would be far better off if no-one had the power to meddle with its money supply. As it is, there has been plenty of meddling already, and quite a bit of suspension of disbelief would be necessary to conclude that there will be no price to pay. As always in monetary matters, the bill will be presented at an unknown future date, but it could be a very big bill in this case... but Switzerland's Keynesian dunderhesds are well on their way to that coming due as they blast any gold repatriation plans as "reducing the credibility of the SNB’s policy."

Celebrate The Recovery By Buying Restaurant Garbage (And Yes: There's An App For That)

In a move reminiscent of the Victorian Age, when those "downstairs" lived off the scraps of those "upstairs", a new app 'PareUp' is set to revolutionize the way the increasingly poor and starving masses in America feed themselves. As HuffPo reports, in a country that wastes between 30 and 40 percent of its food, PareUp is a new app that aims to connect consumers to restaurants and food shops with excess food - enabling the impoverished to benefit from the excess greed of the well-to-do by buying their used and forgotten food scraps (at significant discounts of course). "Good food is a terrible thing to waste," boasts the app - and rightly so - but is it not a dismally sad reflection of a nation, that opines of its all time high stock prices as indicative of its cleanest dirty shirt status, that we need this service (and there's an app for that!)

Strong 10 Year Auction Prices At Lowest Yield Since June 2013

And so the flattening, and the "inexplicable" (Chinese and Japanese) bid for Treasurys continues. After yesterday saw 3 Year paper selling at a better than expected rate, if still at the highest yield since 2011, today it was the turn of 10 year paper to sell briskly, with the high yield of 2.612% once again pricing through the When Issued 2.618%, although in a mirror image of the short end, this was the lowest yield since June of 2013. The bid to cover came at 2.66, modestly below April's 2.76 and on top of the TTM average of 2.63. However, the internals were more curious with Dealers getting just 29.1%, matching their take down from March, and the lowest since March 2013. This meant Indirects were left with 49.3%, well above last month's 44.7%, and above the 43.9% TTM average, highest since the 49.7% in February. Directs were left holding 21.6% of the auction, above the 17.7% average.

Gazprom Boosts Ukraine Overdue Invoice To $3.5 Billion After Kiev Forgot To Pay April Bill

Looks like Ukraine won't be buying that gold with IMF loan proceeds after all. Moments ago, in what has become a monthly tradition, Gazprom reported that Ukraine has once again forgotten to pay its latest monthly, April, gas bill. As a result, the total amount of money now due rises from $2.2 billion which was the invoice through the end of April, to $3.5 billion. As RT reminds us, and as was reported previously, this means that in June Ukraine might receive Russian gas only on the condition of advanced payment.