Guest Post: Resentful Rage - Stage-4 Of Cancerous Inequality

America’s uniquely irrational behavior among civilized nations, whether or not a product of our diverse multi-racial society, has not served the country well during the past two decades adding the social problems created by racial inequality to an ever-widening economic inequality among Americans that Ronald Reagan legated to us. And as social inequality merges with economic inequality, a synergy of resentful rage is being created in cities and communities largely populated by people of color. Enter the city of Baltimore with a two-thirds black population, America’s problem-du-jour.

Class Of 2015 Sets Student Debt Record

The graduating class of 2015 is the most heavily-indebted college class in history and the chart is "up and to the right," which in the case of student loans, is anything but encouraging. Fortunately, we have some advice for this year's graduating seniors...

Smile, Nod, Lie, & Prepare For The Reset

Unless you are growing sales i.e. expanding the business, any growth in cash flow is temporary.  And that is really the point of all this isn’t it? So go ahead boys tell me how the market is fairly valued.  Tell me that PE’s prove it.  Tell me how earnings are great and that unemployment is bang on in line with a full steam ahead economy.  Tell me the lackluster economic growth year on year since the big bang is just transitory pains with a bit winter thrown in.  I, like you, will smile and nod, both knowing it’s a lie and both of us preparing for the reset. 

Americans Not In The Labor Force Rise To Record 93,194,000

In what was an "unambiguously" unpleasant April jobs payrolls report the fact that the number of Americans not in the labor force rose once again, this time to 93,194K from 93,175K, with the result being a participation rate of 69.45 or just above the lowest percentage since 1977, will merely catalyze even more upside to the so called "market" which continues to reflect nothing but central bank liquidity, and thus - the accelerating deterioration of the broader economy.

5 Things To Ponder: Margin Of Safety

"The median stock in the S&P 500 is the most expensive it has even been (for as long as we have data). That's never a good sign! If your favorite valuation indicator is not at 'the highest ever', then it is likely now at 'the highest ever except 2000'. That's not good company unless you are a short seller."

Home Flipping Profits Hit Record As Wall Street Drives Speculation (Again)

There's never been a better time to be a home flipper. Not only are average returns at all-time highs (you can double your money in Baltimore), you can even obtain cheap financing from Wall Street as opposed to dealing with pesky local banks. Better still, there's a very good chance you won't have to deal with annoying aspiring homeowners because according to RealtyTrac, the percentage of flipped homes sold to other "investors" is at a four-year high.

What Is The Difference Between An ISIS Terrorist And A Freedom Fighter: "Appropriate Vetting"

As we reported yesterday, in addition to Turkey and Saudi forming an alliance to topple Syria's despised anti-Qatar nat gas pipeline leader, Bashar Assad, the US has now begun training and arming Syrian rebels. But how will the US know it is arming Syrian rebels, aka opposition "freedom fighters" and al-Nusra or Islamic State jihadists who will promptly turn around and use the same weapons and training against the US? The answer: "appropriate vetting." No, really.

Deflation Works!

Threatened with deflation, the authorities will want to turn the tide in the worst possible way. What’s the worst way to stop deflation? With hyperinflation. Yes, we may suffer a year or two more of sluggish growth... or even deflation. Stocks will crash and people will be desperate for paper dollars. But sooner or later, the feds will find their feet and lose their heads. Most likely, the credit-drenched world of 2015 will end... not in a whimper of deflation, but in a bang. Hyperinflation will bring the long depression to a dramatic close long before a quarter of a century has passed.

The Reason Why There Is No Wage Growth For 83% Of US Workers

For all who are still confused why there are no wage hikes despite the Fed's relentless efforts to micromanage the economy and stimulate wage growth via trickle-down record high stock market prices, the answer is that there is wage growth. Just not for 83% of the working population. 

Goldman Crushes The American Manufacturing Recovery Dream - Auto Sales Expectations Are Unrealistic

Auto sales have recovered to the 16.5-17 million range, and many observers predict further gains in coming years (despite, as we previously noted, missing expectations for the last few months). But to Goldman Sachs, the current sales pace already looks high relative to the medium-term fundamentals; and their assessment of scrappage rates, population growth, licensed drivers, and vehicle ownership suggests that trend demand for autos - excluding cyclical fluctuations - is only 14-15 million units per year.

Free Lunches, Fragile Fed Faith, & Minsky Moments

Investors are beginning to question the efficacy of these extreme central bank policies. More are joining the chorus of critics that believe policies have become counter-productive in both the short and long run.  If true, it could mean that a Fed hike might come sooner than markets believes; and may occur prior to the arrival of the desired and optimal economic conditions. There must be a lesson to learn for those investors who blindly follow central bank actions.  The lesson embedded in the dramatic re-pricing in European financial markets during the past 12 days may simply be that there are dangers when chasing assets irrespective of price levels. It seems to us that the ability of central banks to generate a Pavlovian or conditional investor response to their policy actions is now rightly being called into question.