Edward Snowden Is Conducting A Live Q&A Session

Eager to take advantage of NSA-whistleblower Edward Snowden's current unincarcerated status and to ask him questions about his motives or thoughts? Here is your chance courtesy of the Guardian which is holding a live Q&A session with the famous leaker. As the Guardian notes: "He will be online today from 11am ET/4pm BST today. An important caveat: the live chat is subject to Snowden's security concerns and also his access to a secure internet connection. It is possible that he will appear and disappear intermittently, so if it takes him a while to get through the questions, please be patient." Some more from the Guardian:

• Edward Snowden is answering your questions about the NSA leaks live
• Post your questions in the comment section below and recommend your favorites
• We are posting Snowden's replies above the line
• You can also follow along on Twitter using the hashtag #AskSnowden

The live blog can be reached at the following link.

Following Surge In "Fails To Deliver" To Two Year Highs, Treasury Market Finds A Brief Respite

Our "silver lining" concluding remark to last week's lackluster 10 Year bond reopening auction was that "the good news is that with the reopening, dealers should have some additional collateral for a while, or at least until the Fed monetizes it. Look for this CUSIP - VB3 (On The Run) to remain on the POMO exclusion lists for white a while." Sure enough, following the Friday settlement of this auction, things in the Treasury repo market have normalized somewhat after hitting very dangerous levels. How bad did it get? The following chart of failures to deliver from the NY Fed shows just how acute the shortage of "high quality collateral" (where the 10 Year is the fulcrum instrument) got in the past two months, with the total rising to $129 billion, or the biggest freeze in the repo market since the debt-ceiling crisis in the summer of 2011 when this number hit $280 billion.

Chart Of The Day: The Future Doesn't Look So Bright

While the headline print of this morning's Empire Fed beat expectations, as we noted earlier, the underlying characteristics were an unimitgated disaster by any measure. The current business climate, reflecting more a rear-view-mirror-based world was weak but the future expectations index - which should be more important for an equity market that supposedly discounts the future - had some significant headline risk. There is however, one chart that sums up the confidence of the CEOs in this nation. Capital Expenditure expectations (the measure of reinvesting in organic growth producing assets - as opposed to buybacks and shareholder-reacharound funding) plunged at its fastest rate on record and printed at its lowest since the collapse in 2008/9. It seems, to us at least, that the future is not so bright.

Empire Fed Headline Beats Despite Plunge In Most Indicators, "Labor Market Conditions Worsened"

And yet another baffle with absolute and unbelievable BS economic number is out, this time the Empire Fed index which magically spiked from -1.43 to 7.84 on expectations of a 0.00 print. We say magically, because besides the headline number, virtually everything else was down! To wit: New Orders down, Shipments down, Unfilled Orders down, Delivery Time down, Inventories down, Number of Employees down, Avg Workweek down, should we continue? The Empire Fed report admits as much: "The general business conditions index—the most comprehensive of the survey’s measures—rose nine points to 7.8. Nevertheless, most other indicators in the survey fell." Almost as if the NY Fed apologized for having to make up headline numbers.

Key Events And Market Issues In The Coming Week

In the week ahead, we get the usual middle-of-the-month batch of early business surveys, including the New York Empire, Philly Fed and Eurozone Flash PMIs. The second key focus will be a number of important monetary policy meetings, including the FOMC, as well as the Swiss, Norwegian Turkish and Indian policy decisions. The latter two are particularly interesting in the light of the recent EM weakness. The main event this weak will be the FOMC meeting after the recent market focus on the timing of tapering of the QE3 program. Swings in bond markets related to the FOMC meeting could be the primary source of FX volatility this week.

Futures Ramp Higher Ahead Of Key FOMC Announcement As Nikkei Regains 13,000

First it was the "most important" payroll print in years, then the "most important" retail sales number, and now we are just days ahead of the "most important" FOMC statement in years as well, as the fate of the centrally-planned markets lies in the hands of Bernanke's decision to taper, or not to taper. The main catalyst for now still appears to be an ongoing wrong interpretation of Hilsenrath's Thursday blog post in which some still see reaffirmation by the Fed that it won't taper, when all the Fed's mouthpiece said is that the short-end would be anchored even as the long-end is allowed to rise. Looking at the well-known no volume levitation futures action, which in the overnight session has wiped out all of Friday's losses and then some simply due to a 2.73% rise in the Nikkei overnight back above 13,000 driven by the USDJPY briefly regaining 95.00, the market has made up its mind (if only for the time being) that whatever decision the Fed takes regarding the monthly level of liquidity injection is a bullish one. At least until it changes its mind next.

Entitlement America And The High Cost Of "Free"

Almost three years ago we first highlighted the real math behind the surging entitlement class that America has become. So why does a large portion of the population choose not to work when there are many jobs available? The answer is simple. If you can receive 2-3 times as much money from unemployment, disability, and/or welfare benefits (subsidized housing, food stamps, free cellphones, etc.) as you can from a temporary or part-time job, and live a life of leisure, why work? This is the ugly reality we illustrated just six months ago and the situation - amid what is apparently called a 'recovery' remains a depressingly real sign of the times. The political allure of free is so strong that an alarming number of people choose to become wards of the entitlement/welfare state rather than captain their own destiny. Indeed, while many are 'proud', 49% of American households now receive one or more government transfer benefits amounting to 18% of all personal income and a burden of $7,400 for every American - seemingly threatening the supposed self-reliance that has long characterized the American national psyche.