California Set For A 10-Cent Gas Tax Hike

Legislation has been in introduced in the California state Senate that would increase the state’s approximately 47 cents-per-gallon gas tax by 10 cents.  The new California fuel levy, which would be the state's first increase since 1994, will be collected on top of an 18.4-cents-per-gallon federal gas tax that is charged to all drivers in the nation to fill the federal government’s transportation funding coffers. 

 

Forget "Game Theory" - Yanis Varoufakis Introduces "Hope Theory"

While hope has long been dismissed as a strategy among the investing public, for game-theory expert (and Greek FinMin) Yanis Varoufakis, "hope" appears to be all he has left. Reflecting on James Byrnes 1946 speech, Varoufakis explains a “Speech of Hope” for Greece would make all the difference now – not only for us, but also for our creditors, as our renaissance would terminate the default risk.

C-Suite Gamblers - The Real "Dumb Money" Inflating The Bubble

U.S. companies announced $141 billion of new stock buyback programs last month and $243 billion of new M&A deals. Both figures are all-time records, and according to bubblevision are further evidence that CEOs are bullish on their companies and the economic outlook. You might say that. Then, again, it might put you in mind of swarming moths heading for a light bulb. The baleful truth is this. In its arrogant and misbegotten seizure of all financial power, the nation’s central bank has turned the C-suite of corporate America into a destructive agent of bubble finance. That’s ‘dumb money’ with a vengeance.

The Rich Are Losing Faith In The Stock Market

Inconceivable? Consumer Comfort among the highest income earners in America has totally and utterly collapsed. Despite record-er highs in the US equity market and promises from every talking head that Q1 was a blip, those earning $100k or over have seen their 'comfort' crash to the lowest since September...

IMF Panics - Slashes US Growth Forecasts, Demands Fed Stay On Hold For Another Year

Anxiety over financial stability and shadow banking risks appear to have force Christine Lagarde and her fellow extrapolators to hit the panic button:

IMF CUTS U.S. 2015 GROWTH FORECAST TO 2.5% FROM 3.1%, URGES FED TO DELAY FIRST RATE INCREASE UNTIL 1H 2016

Adding that they viewed the Dollar as "moderately overvalued" and any more appreciation would be "harmful," it seems global disinflationary pressures have left the IMF no choice but to say publicly what everyone has uttered under their breath. Now Yellen is really cornered.. and just exactly how are the talking heads going to spin this as positive?

The Real Reason The US Economy Simply Won't Grow: Lowest Worker Productivity In 22 Years

According to just released final data by the BLS, in Q1 labor productivity barely rose, growing 0.3% in Q1, following a -0.1% drop in the fourth quarter. Worse, on a sequential basis, productivity dipped by a -0.8% in Q1 (a 3.1% SAAR), after a -0.5% drop (-1.9% SAAR) in Q4. This is the first sequential drop in nonfarm productivity in 22 years, or since 1993!
That, in a nutshell, is also the real reason the US economy refuses to grow no matter how many billions in liquidity the Fed stuffs into it.

Saudis Believe They Are Winning The Oil Price War

It’s almost a foregone conclusion that OPEC won’t cut its production levels at its June 5 meeting in Vienna. Anyone needing strong evidence, if not proof, of this need only listen to Ali al-Naimi, the architect of the cartel’s effort to reclaim market share. In fact, some observers say OPEC not only won’t cut overall production levels from 30 million barrels a day to shore up prices, but may even increase them.

Initial Jobless Claims Hover Near 42 Year Lows

After 2 weeks of increassing (though near cycle low) jobless claims, last week saw a modest drop from a revised 284k to 276k. Texas saw initial claims jump to the highest in 5 weeks - stable at new normal higher-than-before the oil price crash. This leaves the smoother average hovering at or near 42 year lows... which leaves everyone in the world asking why ZIRP and why lower for longer and why moar threats of QE at every negative macro print or 2% drop in stocks. It seems pretty clear that companies have cut as far as they can cut... so any downturn in the economy now flows right through to the bottom line. The big question is - does any of this data extrapolate into the noise-prone payrolls number tomorrow.. and thus the future of the western world's wealth-creation bubble machine.

Tsipras Sticks To "Red Line" Rhetoric Cornered By Party Radicals

"An early election would be possible, but the least likely: the PM will likely be able to pass an agreement through parliament with opposition support, in turn generating strong incentives for a shift to a more moderate coalition within the existing parliament rather than a new electoral campaign following a painful compromise with European creditors," Deutsche Bank says, laying out the likely outcome if and when Greek PM Alexis Tsipras does finally accept an unpopular deal with creditors.

Former European Council President Van Rompuy Appointed As Japan Haiku Ambassador

After disappearing from the public scene last November when his term in EC expired, Herman has re-emerged, or rather, reincarnated into his new role. And while it is not hardly as dramatic as the emergence of a Hermina van Rompuy, his new role will surely raise several (knowing) eyebrows. Meet: Japan's new Haiku Ambassador. 

 

Frontrunning: June 4

  • China stocks fall, led by ChiNext, on margin tightening; Hong Kong down too (Reuters)
  • Bond market sell-off rumbles on, stocks feel the pinch (Reuters)
  • Bond Rout Wipes Out 2015 Gains as Traders Stay Glued to Screens (BBG)
  • Greek Groundhog Day Continues With Talks Failing to Break Impasse (BBG)
  • Greece and Its Creditors Agree on Some Measures in Bailout Talks (WSJ)
  • 'Bellingcat Report Doesn't Prove Anything': Expert Criticizes Allegations of Russian MH17 Manipulation (Spiegel)
  • GE Said to Hire Banks to Start Sale on $20 Billion Assets (BBG)
  • Alibaba Pictures plans $1.6bn share sale (FT)
  • How Companies Justify Big Pay Raises for CEOs (BBG)